EXCL - To improve coverage in Aceh

EXCL - To improve coverage in Aceh XL Axiata (EXCL) is pushing to improve its 4G network in Aceh, covering as many as 3,980 villages. As of today, the company has deployed 2,300 BTS in the province with most of them are 4Gs. This is an effort to improve its service that saw a 15% growth in data traffic this year. (Source : Telko) Comment : Ex-Java areas have become source of growth for mobile segment due to lower penetration compared to more matured market in Java areas, which is deemed to be a good move. For EXCL, it may need to carefully consider its expansion strategy to maintain its network quality in Java to retain market share, while managing its balance sheet, since it could take significant capex going forward. Despite that, we still maintain our positive view on EXCL especially on the back of improvement in pricing in the industry.