Mirae Asset Bets on Infrastructure Suppliers Over Operators in Indonesia’s $13B Data Center Boom

JAKARTA, Investortrust.id — A sharp surge in artificial intelligence computing demand is opening massive expansion avenues for Southeast Asia's digital ecosystem, with domestic data center infrastructure spending projected to hit $13 billion (Rp 227 trillion).

Mirae Asset Sekuritas Indonesia highlighted that 10 domestic listed companies hold prime exposure to the development wave, while explicitly favoring engineering, utility, and infrastructure suppliers over colocation facility operators.

In an equity research note titled ‘Indonesia’s Data Center Cost Edge Meets a Power Bottleneck’, analyst Daniel Widjaja identified the primary corporate beneficiaries across two distinct categories: operators and infrastructure enablers.

Direct exposure operators include PT DCI Indonesia Tbk (DCII), PT Indointernet Tbk (EDGE), PT Indosat Tbk (ISAT), PT Telkom Indonesia (Persero) Tbk (TLKM), and PT Dian Swastatika Sentosa Tbk (DSSA).

On the infrastructure supply side, the brokerage flagged industrial estate developer PT Puradelta Lestari Tbk (DMAS), building contractor PT Total Bangun Persada Tbk (TOTL), private utility PT Cikarang Listrindo Tbk (POWR), alongside telecommunications fiber specialists PT Ketrosden Triasmitra (KETR) and PT Mora Telematika Indonesia Tbk (MORA).

While generative AI algorithms demand massive server capacity, investing directly in regional server housing carries occupancy risk. With Jakarta's colocation market facing elevated vacancy, contractors and private utilities that monetize up-front civil engineering, guaranteed land parcels, and dedicated transmission lines capture direct cash returns without taking on tenant absorption risk.

Monetizing Construction Over Waiting for Tenants

Mirae Asset maintained a neutral stance on Indonesia’s data center sector over the medium term, while remaining constructive on its long-term trajectory. However, the brokerage firmly favors infrastructure contractors and utility suppliers for near-term portfolio exposure.

"We prefer infrastructure suppliers as our direct investment choice. A 20.4% vacancy rate in Jakarta reinforces our preference to monetize construction and operation rather than waiting for tenants," Daniel noted in the report published on Thursday, Sept. 17, 2026.

Among suppliers, DMAS provides industrial plots backed by an assured captive power supply of 993 megavolt-amperes (MVA). Commercial contractor TOTL holds strong leverage, with data center developments accounting for roughly 39% of its total project pipeline.

POWR is positioned to secure resilient, recurring baseload electricity demand from power-dense server racks. Meanwhile, subsea cable operators KETR and MORA provide the 'Rising-8' connectivity corridor, boasting an aggregate transit design capacity of up to 400 terabits per second (Tbps).

AI Workloads Drive Regional Compute Hunger

The multi-billion-dollar development boom is propelled by rising regional compute requirements. Mirae Asset estimates global data center electricity consumption will reach roughly 945 terawatt-hours (TWh), with total installed capacity topping 200 gigawatts (GW) by 2030.

Global hyperscaler capital expenditure is forecasted to reach $1.25 trillion by 2027, underwritten by approximately $2.5 trillion in contracted cloud service backlogs.

AI-related processing is expected to command 65% of overall data center computational loads by 2027, widening to 71% by 2030, with inference tasks overtaking raw model training.

Across the Asia-Pacific region, operational data center capacity stands at 15.1 GW, with 4.8 GW actively under construction and 21.7 GW in development queues. In aggregate, pipeline projects represent 1.7 times currently installed capacity.

Regional supply pinches have accelerated this migration. The Johor corridor in Malaysia operates at a tight 0.7% vacancy rate, while Singapore has capped new builds at roughly 25 MW.

"Johor is capturing the initial spillover, while upgraded subsea links and targeted tax holidays strengthen Batam's proposition as the prime alternative hub," Daniel added.

Competitive Construction and Operating Tariffs

Indonesia holds a notable cost advantage over Malaysia across both initial capital outlays and long-term operating overhead.

Mirae Asset estimates domestic data center development costs stand around $8.9 million per megawatt (MW), lower than Malaysia’s average of $9.9 million per MW. Indonesian power tariffs are also cheaper at 6.3 U.S. cents per kilowatt-hour (kWh), compared to 10.6 U.S. cents per kWh across the border.

These structural cost efficiencies generate estimated cash yields on cost between 10% and 11%.

Jakarta remains the primary domestic colocation node, with operational capacity projected to reach 455 MW by late 2026—a 41.2% year-on-year increase—and potentially surpassing 2 GW by 2030.

Batam is being developed to service regional hyperscale platforms, offering low land costs and ultra-low network latency of under 2 milliseconds to Singapore.

In a modeled 100 MW colocation scenario assuming monthly rental rates of $200 per kilowatt, Mirae Asset projects an internal rate of return (IRR) of 16.3% in Jakarta, versus 16.2% in Kuala Lumpur. In the hyperscale segment at $150 per kilowatt per month, Batam delivers an estimated IRR of 15.1%, beating Johor’s 13.4%.

"Indonesia’s cost edge supports compelling financial returns, but operational grid readiness and low-latency network interconnects will ultimately dictate tenant absorption," Daniel concluded.

Power Delivery Remains the Primary Bottleneck

Despite favorable economics, electricity grid activation remains the single largest operational roadblock facing Indonesian developments.

The estimated interconnection lead time to bring a 100 MW server facility online in Indonesia averages 36 months, triple the 12-month delivery window common in Malaysia.

"Faster project delivery keeps Johor ahead despite higher baseline costs," Daniel pointed out.

Malaysia boasts more than 1,300 MW in active server capacity, with an additional 3,252 MW under planning. Indonesia operates 394 MW of installed capacity, with 1,221 MW in planning stages.

Although Indonesia maintains a domestic reserve margin surplus of roughly 41 TWh alongside lower retail tariffs, grid delivery timelines and inter-regional transmission constraints slow commercialization.

The planned high-voltage subsea link between Java and Sumatra is not scheduled to commence commercial operations until 2031. On-site solar installations paired with battery energy storage systems offer private operators behind-the-meter alternatives, though institutional deployment remains nascent.

In contrast, Batam's subsea connectivity is advancing rapidly. Capital commitments from tech hyperscalers including Google, Meta, and Microsoft are projected to boost Batam’s international subsea fiber bandwidth to over 1,750 Tbps by 2029, representing a 407.8% expansion.

"Tenant absorption in Jakarta currently trails incoming capacity, while Batam remains our premier long-term growth frontier. However, bridging the utility infrastructure bottleneck will take time," Daniel said.