Telkom (TLKM) Aims to Reign as the Leader in the Data Center Market

KONTAN.CO.ID - JAKARTA. PT Telkom Indonesia Tbk (TLKM) continues to develop its data center business through its business entity, PT Telkomsel Data Ecosystem (TDE) alias NeutraDC.

Recently, NeutraDC officially partnered with BDx Data Center, a joint venture between PT Indosat Tbk (ISAT) and PT Aplikanusa Lintasarta.

Director of Group Business Development Telkom Indonesia, Honesti Basyir, stated that this collaboration is a step for TLKM to maximize the TLKM data center under the auspices of TDE.

"We want to become a market leader in Indonesia and also regionally, so expansion is not only in Indonesia but also in several regions," he said, on Thursday (2/1).

Honesti said that currently, TLKM is communicating with several countries, including Malaysia, the Philippines, and Japan to have a data center there.

The process of consolidating the data center is still ongoing. Most recently, the TLKM data center in Singapore under Telin has been consolidated into the Telkomsel Data Ecosystem.

"Starting in 2024, the Telkomsel Data Ecosystem will be Telkom's engine for the data center," said Honesti.

The total capacity of the TLKM data center reaches 40 megawatts–45 megawatts. With this amount, the utilization rate of the Telkom Group data center has reached 70%.

Honesti said this year Telkom plans to build a data center with a capacity of 50 megawatts (MW). TLKM will build campus 1 and 2 hyperspace data centers (HDC) in Cikarang and Batam.

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Research Analyst MNC Securities Vera explained that the market demand for data center services is potentially increasing from 98 MW in 2022 to 1,256 MW in 2031 with a CAGR of 33%.

Especially since Indonesia has the fastest-growing e-commerce market with internet users amounting to 76.28% of the population, which drives the growth of the data center.

"The Telkom Group will not let this promising prospect slip away. Through NeutraDC, TLKM will pioneer the data center business in Indonesia," Vera explained in the research.

As of June 2023, NeutraDC earned revenue of IDR 248 billion with EBITDA of IDR 59 billion. Meanwhile, NeutraDC is targeting revenue of IDR 505 billion throughout last year.

MNC Securities recommends buying TLKM with a target price of IDR 4,650. Until the end of trading on Thursday (2/1), TLKM parked at the level of IDR 4,040 or strengthened by 2.02%.