0654 GMT - A merger of Indonesian telecom assets by Axiata and Sinar Mas is positive for Indonesia's biggest telcos but negative for tower companies, Citi analysts Arthur Pineda and Luis Hilado write in a research note. The resulting three-player market without a subscale player desperate for market share "opens the door to potential market repair," reminiscent of higher prices that followed the 2022 Indosat-Hutchison tieup, they write. Every 1% improvement in average revenue per user could boost net profit of Telkom and Indosat by 1% and 3%, respectively, they estimate. The analysts lower target prices on tower companies, however, to reflect likely decommissioning of duplicated sites. They have a neutral rating on Sarana Menara and a sell rating on Tower Bersama, but keep buy ratings on top telcos Indosat and Telkom. (ben.otto@wsj.com; @benottoWSJ)
(END) Dow Jones Newswires
December 12, 2024 01:54 ET (06:54 GMT)
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