TLKM - 9M23 results comes in-line

TLKM - 9M23 results comes in-line Telkom Indonesia (TLKM) 9M23 EBITDA came in-line with our estimate at 75.4%, yet below consensus by 3.2% as it recorded a 6.6% EBITDA growth to IDR20.7 tn in 3Q23. A growth in quarterly EBITDA was driven by lower core costs by 5.1% thanks to a decline in personnel expenses and G&A. Meanwhile, revenue barely increased +1.0% qoq in 3Q23 to IDR37.76 tn, bringing 9M23 revenue to IDR111.2 tn or achieving 74.9%/72.7% of ours/consensus estimates. Furthermore, reported net profit increased 6.5% qoq to IDR6.7 tn in 3Q23, representing a 17.6% yoy bump in 9M23 net profit of IDR19.5 tn, or 75.3% of ours/72.3% of ours/consensus. On mobile, 3Q23 ARPU was mostly flat at IDR4.34/MB, yet it subs base improved +3.3% qoq. On fixed broadband, Indihome’s ARPU continued to decline to 1.2% qoq in 3Q23 to IDR257. (Source: Company) Comment: While we are waiting for further details to be released, TLKM's 9M23 results are squarely in-line with our estimates from top to bottom-line given better costs. Although, we suspect lower cash cost was mostly attributable to seasonality as the company may have frontloaded cost spending in 2Q23. We believe Indihome’s lower ARPU was caused by intense competition in fixed broadband.