Telkom Unveils Four-Pillar Transformation Plan, Triggers Market Optimism
Main Takeaways
|
JAKARTA, investortrust.id – PT Telkom Indonesia (Persero) Tbk, or TLKM, has launched a sweeping transformation strategy centered on four pillars designed to drive long-term shareholder value, under the leadership of newly appointed Chief Executive Officer Dian Siswarini and Chief Financial Officer Arthur Angelo Syailendra.
The move signals Telkom’s intent to streamline its sprawling structure and reposition itself as a strategic digital holding company. In the past month, the company's stock has surged nearly 9% on the Indonesia Stock Exchange, from Rp2,590 to Rp2,820. Foreign investors have poured in over Rp1.01 trillion ($62 million), making TLKM one of the most accumulated stocks by overseas funds.
According to Paulus Jimmy, equity analyst at Sucor Sekuritas, the transformation was unveiled during the TelkomGroup Investor Day, and aims to strengthen corporate governance, enhance operational efficiency, simplify the company’s structure, and pivot toward a new digital holding model.
Targeting Efficiency, Monetization, and Focused Growth
In the first phase of its transformation, Telkom targets Rp6 trillion ($368 million) in annual savings through optimized capital expenditure (capex) and operational costs (opex). The savings will stem from tighter governance and disciplined capital allocation.
Management also committed to reallocating capital toward projects with higher returns, supported by the company’s solid balance sheet. However, it has yet to disclose concrete impacts on profit margins or dividend payouts.
A central feature of the overhaul is restructuring Telkom’s business units. The number of subsidiaries will be slashed from 55 to 22 over the next two to three years. The company plans to consolidate its digital infrastructure under its B2B division while maintaining focus on B2C operations via Telkomsel.
The third pillar focuses on monetizing digital assets, including fiber-optic cables, data centers, cell towers, and satellite infrastructure. Telkom currently manages 177,443 kilometers of fiber optic cable, 271,086 base transceiver stations (BTS), 43,472 towers, 53 data centers, and three satellites with a combined capacity of 42.2 Gbps. Management estimates that the market has undervalued these strategic assets, which could potentially unlock Rp100–150 trillion ($6.1–9.2 billion) in value.
Building a Strategic Digital Holding
The final pillar is the transformation of Telkom into a strategic digital holding company, aimed at accelerating business synergies, tapping new markets, and boosting overall market valuation. Executives say the shift will strengthen Telkom’s fundamentals and provide sustainable value for shareholders.
“Although implementation will be gradual, we believe TLKM's current share price does not yet reflect the full value of its strategic assets,” Sucor Sekuritas wrote in a research note. The firm maintained a “buy” recommendation on the stock, with a price target of Rp3,000 per share.
Still, analysts caution that the transformation’s success hinges on execution. “Investors should be mindful of implementation risks, particularly internal challenges facing the new leadership,” Paulus added.
Track the true value of Telkom and other top Indonesian stocks with InvestingPro — now with a special discount exclusively for Investortrust readers. Click here to unlock the offer.