ISAT - EBITDA growth slows in 3Q24, full-year outlook intact

KBVS Update
Friday, 1 November 2024

ISAT - Resilient 9M24; ‘25F EBITDA to expand
(Reiterate BUY - TP: IDR3,250)

Impressive 9M24 growth despite 3Q24 decline. ISAT's revenue for 9M24 reached IDR41.81 tn, a 11.6% yoy increase, driven by a 9.0% yoy growth in data revenue. Despite a 4.6% qoq decline in EBITDA to IDR6.59 tn in 3Q24, cumulative 9M24 EBITDA still managed to grow 14.5% yoy to IDR20.0 tn.

Cost synergies to drive ‘25F EBITDA margin. We expect ISAT's '25F revenue to increase 6.5% driven by a 9.5% data-usage surge on its expanding network, while cash-costs grow slower at 5.7% due to FBB synergies, leading to a 48.8% EBITDA margin in '25F.

Reiterate BUY with TP of IDR3,250, based on 3.8x ‘25F EV/EBITDA (+0.5SD 5yrs-historical mean).

Regards,
Steven Gunawan - KBVS Research