TOWR - Maintains investment grade rating

TOWR - Maintains investment grade rating Fitch Ratings Indonesia has assigned Profesional Telekomunikasi Indonesia (TOWR)'s (Protelindo, BBB/AAA(idn)/Stable) bond issuance of IDR1.1 tn a national long-term rating of 'AAA(idn)'. The bonds will be the third phase of issuance from the company's IDR5.0 tn bond programme and the entire net proceeds will be used to refinance existing debt. (Source : Fitch) Comment : Amid consolidating tower business, TOWR manages to hold its strong market share, beside growing non-tower business esp. fiber, where TOWR has been on pole position. On tower business, we expect that revenue from EXCL and Telkomsel could be able to compensate non-renewal from ISAT. TOWR’s relatively high gearing ratio should not be something to worry due to nature of the industry and its ability to maintain stable cash flow on locked-in long term contracts.