ASEAN Insight Provider, CrossASEAN Research

Angus Mackintosh

In Equity Sales and Research for more than 25 years covering Asian markets. Possesses in-depth knowledge of a wide range of companies, economies, and markets in Asia. Over his career, he has specialised in HK/China and ASEAN markets at various different Investment Banks, most recently heading equities in Indonesia for Bank of America Merrill Lynch in Jakarta for more than three years. Whilst in Jakarta, he produced a well-read daily and weekly product on the Indonesian market, which included company visits, as well as political, economic and sector commentary. A former racing skier, who enjoys ultra-marathons and surfing in his spare time.

ASEAN Insight Provider

Linknet - Confounding the Critics with Value Add - Management Call

Linknet - Upwardly Mobile - On the Ground in J-Town

Linknet - A Captive Audience - On the Ground in J-Town

Linknet (LINK IJ) - King of Cable - On the Ground in J Town

Smartkarma

Smartkarma unites the fragmented investment industry, connecting institutional investors, independent research providers, and corporates within a single network.

Research Reinvented

Equity Bottom-Up

The <a href="https://www.smartkarma.com/entities/1050" target="_blank" data-smartkarma-citation="entities:1050:1">Link Net Tbk Pt (LINK IJ)</a> post results call was far more informative than most, was awash with questions and ran well over an hour. It achieved another strong quarter, despite the seasonal impact of the Lebaran holiday, with revenues +16%, EBITDA +19% and net profit +28% YoY for 3Q16. EBITDA margins remained solid at 58% net profit margins at 28% (versus 23% in 2015 on cost savings).The company continues to dominate the premium market and saw its ARPU rise marginally to Rp403,000 per month. There was a very slight increase in churn to 2.2% but this was predominantly seasonal. It has signed up 90% of the customers it took on through promotions in 3Q16. Residential continues to dominate but there is a renewed focus on the enterprise market (+16% sales growth), where it is offering more standardized packages for SMEs and hotels, as well as recruiting more dedicated marketing people. It utilizes idle residential capacity during the day for the enterprise market.It also sees more synergies ahead within the Lippo Group, as it offers bundled mobile broadband though Bolt, as well as satellite broadband for outlying areas. It expects new revenues from Batam and Medan in 2Q17. It is sanguine about <a href="https://www.smartkarma.com/entities/1051" target="_blank" data-smartkarma-citation="entities:1051:1">Telekomunikasi Indonesia (TLKM IJ)</a> entering the premium market and has seen no sign of aggressive pricing. It is confident it can maintain a leading edge in this segment.The company continues to buy back shares, with its net cash (Rp246bn 3Q16) and continues to reinvest in the business, given low rates of penetration. This continues to be an interesting way to play the rising middle class in Indonesia and its seemingly inexorable demand to faster internet speeds. Valuations are still relatively undemanding, with the stock trading on an FY17E PER of 15.4x and FY18E PER of 12.4x with EPS growth of +24% and +22% respectively, according to Bloomberg consensus.

The Link Net Tbk Pt (LINK IJ) post results call was far more informative than most, was awash with questions and ran well over an hour. It achieved another strong quarter, despite the seasonal impact of the Lebaran holiday, with revenues +16%, EBITDA +19% and net profit +28% YoY for 3Q16. EBITDA margins remained solid at 58% net profit margins at 28% (versus 23% in 2015 on cost savings).The company continues to dominate the premium market and saw its ARPU rise marginally to Rp403,000 per month. There was a very slight increase in churn to 2.2% but this was predominantly seasonal. It has signed up 90% of the customers it took on through promotions in 3Q16. Residential continues to dominate but there is a renewed focus on the enterprise market (+16% sales growth), where it is offering more standardized packages for SMEs and hotels, as well as recruiting more dedicated marketing people. It utilizes idle residential capacity during the day for the enterprise market.It also sees more synergies ahead within the Lippo Group, as it offers bundled mobile broadband though Bolt, as well as satellite broadband for outlying areas. It expects new revenues from Batam and Medan in 2Q17. It is sanguine about Telekomunikasi Indonesia (TLKM IJ) entering the premium market and has seen no sign of aggressive pricing. It is confident it can maintain a leading edge in this segment.The company continues to buy back shares, with its net cash (Rp246bn 3Q16) and continues to reinvest in the business, given low rates of penetration. This continues to be an interesting way to play the rising middle class in Indonesia and its seemingly inexorable demand to faster internet speeds. Valuations are still relatively undemanding, with the stock trading on an FY17E PER of 15.4x and FY18E PER of 12.4x with EPS growth of +24% and +22% respectively, according to Bloomberg consensus.

LinkNet - Smarter Enterprise - Post Results Follow Up