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PT Dayamitra Telekomunikasi Tbk (MTEL) or Mitratel’s net profit is expected to increase this year. This is in line with the performance of tower issuers whose coverage is increasingly wider outside Java and their close relationship with Telkomsel. Niko Margaronis, BRI Danareksa Sekuritas analyst, said that these two factors will be Mitratel’s strength in achieving better company performance this year. He projects that Mitratel’s revenue this year could reach IDR 6.8 trillion or grow 10 percent from 2020. Meanwhile, its net profit is expected to shoot up 116.4 percent year on year (yoy) to IDR 1.3 trillion. In fact, next year, the company’s revenue and net profit are estimated to reach IDR 7.8 trillion and IDR 1.78 trillion. Mitratel is recorded as having more than 28,030 tower units currently with 42,016 rentals spread throughout Indonesia. As many as 57 percent of the total towers are located outside Java. “Perhaps previously, Mitratel’s captive market outside Java was only Telkomsel because 10 years ago this area was not attractive to other operators. But in 2018, XL has announced that it will start expanding outside Java. “So Mitratel will become even more attractive because its collocation ratio will increase in the future,” explained Niko in his statement, Thursday (23/12). This increase in colocation, continued Niko, will mainly occur in Sumatra, Kalimantan and Sulawesi. In this way, Mitratel’s profits will increase because the company already has towers on these three islands. Meanwhile, Telkomsel is recorded as having transferred its 10,050 telecommunications towers to Mitratel. This number one telecommunications operator in Indonesia still has thousands more towers that could be released to Mitratel. According to Niko, this factor will make Mitratel even more attractive because previously the towers were single tenant or could only be used by Telkomsel. However, by being acquired by Mitratel, it can be marketed for use by other operators. “This will certainly bring big profits to Mitratel,” he said. Until the third quarter of 2021, Danareksa Sekuritas estimates that Mitratel’s revenue will grow by around 2-3 percent compared to the previous quarter. This projection is based on the Telkom Group report which recorded a double-digit increase in external tower revenue on an annual basis and an increase of around 2 percent compared to the first quarter. According to Niko, growth could possibly be higher because there is no Mitratel revenue data sourced from Telkomsel. It is estimated that the revenue obtained from Telkomsel will increase even more because the income of its two biggest competitors, namely Tower Bersama and Sarana Nusantara Infrastructure, sourced from Telkomsel, has not increased significantly. Meanwhile, net profit is estimated to grow higher, namely around 5 percent. “Bottomline tower businesses that have low leverage will definitely see higher margin increases,” he said. Likewise, Mandiri Sekuritas also views Mitratel’s growth prospects as very attractive considering the consolidation trend in the tower industry and the continued growth in demand for internet access. “Telecommunications towers are currently one of the prominent infrastructure in providing national internet access,” explained Kresna Hutabarat, Mandiri Sekuritas analyst, separately. Mandiri Sekuritas estimates that the company’s revenue by the end of the year could reach IDR 6.71 trillion or grow 8.5 percent from last year. Apart from that, EBITDA is estimated to increase 19.8 percent (yoy) to IDR 5 trillion and net profit will increase 127.2 percent (yoy) to IDR 1.36 trillion.