Indosat (ISAT) Stock Plunges Following Disappointing Financial Results
JAKARTA, investortrust.id – Shares of PT Indosat Ooredoo Hutchison Tbk, or ISAT, suffered a sharp decline following the release of its 2024 financial results, which fell short of analyst expectations. ISAT recorded the steepest year-to-date (YTD) loss among Indonesian telecom stocks, raising concerns over its growth outlook.
As of the close of the first trading session on the Indonesia Stock Exchange (IDX) on Tuesday, Feb. 11, 2025, ISAT shares plunged Rp 265 (13.8%) to Rp 1,655, fluctuating within a range of Rp 1,645 to Rp 1,920. The stock has lost 33.26% of its value YTD, dropping from Rp 2,480 to Rp 1,655, far exceeding the declines seen in competitors PT Telkom Indonesia Tbk, or TLKM, which fell 13% to Rp 2,340, and PT XL Axiata Tbk, or EXCL, which dipped 0.43% to Rp 2,270.
Disappointing Financial Performance Weighs on ISAT Stock
The sharp drop in ISAT shares followed the company’s 2024 financial and operational performance, which missed market expectations. Indosat reported a 9% increase in net profit attributable to the parent entity, rising from Rp 4.50 trillion to Rp 4.91 trillion. Revenue grew 9.1% to Rp 55.88 trillion, up from Rp 51.22 trillion.
Despite the gains, BRI Danareksa Sekuritas downgraded its financial outlook for Indosat, citing intense market competition and weakened consumer purchasing power. The brokerage house revised its 2025 revenue forecast downward from Rp 60.81 trillion to Rp 59.91 trillion, while its net profit projection was cut from Rp 6.28 trillion to Rp 5.92 trillion.
Revenue Breakdown and Subscriber Decline
According to Indosat’s management, the company’s revenue growth was driven by a 7.5% increase in mobile services revenue, reaching Rp 47.03 trillion, while its MIDI (Multimedia, Data, Internet) segment surged 23.4% to Rp 7.98 trillion. However, revenue from fixed telecommunications declined 14.1% to Rp 864.4 billion.
Additionally, Indosat saw a contraction in its customer base, with a loss of 4.1 million subscribers, reducing its total to 94.7 million in 2024. In contrast, average revenue per user (ARPU) for mobile services rose 6.6% to Rp 38,000 per customer.
Analyst Outlook and Stock Target Revision
BRI Danareksa analysts Kafi Anananta and Niko Margaronis noted that Indosat’s 2024 net profit only met 92.6% of the brokerage’s initial projection and 94.6% of the consensus forecast, making it fall short of expectations.
As a result, the brokerage revised its ISAT stock price target from Rp 3,800 to Rp 3,200. Despite the downgrade, it maintained a "buy" recommendation, citing attractive growth prospects and potential dividend policy benefits.
With increasing competition in Indonesia’s telecom industry and slowing consumer spending, ISAT faces challenges in regaining investor confidence. However, its growth in ARPU and strong performance in the MIDI segment may provide some support for future earnings stability.