Maximizing Opportunity of Data Consumption
Key Takeaways:
• EXCL reported a 5.8% YoY growth in net profit to IDR650.7 billion in 1H23, driven by the growth in revenue by 12.0% YoY, operational efficiency, and expanding EBITDA margin to 48.5% (vs 47.8% in 1H22).
• The data and digital services segment has been a key driver, contributing more than 90% to overall revenue with market share reached 18.6% in 2Q23(vs 17.7% in 2Q22).
• Through XL Satu, EXCL managed to record a significant growth in its monthly data consumption by +22.0% YoY to 14.1 GB/user, outperforming its competitors (TLKM: 9.8 GB/user; ISAT: 12.5 GB/user). By FY23E, we expect convergence rate to increase to over 60%.
• We recommend BUY with TP of IDR2,700/share (+18.9% upside), implying 5.9x FY23E EV/EBITDA. Downside risks: 1) data tariff war; 2) lower subscriber growth in 2Q23; 3) high leverage level.
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