Combo package of superior network + 5G availability

EXCL posted robust 2Q26 results, with strong revenue and EBITDA growth anchored by resilient ARPU and a stable subscriber base. We remain confident in EXCL’s long-term potential, driven by network quality improvements and 5G expansion that will continue to catalyze ARPU. Furthermore, the realization of future synergies—from internal merger cost savings to Sinarmas Group-level AI infrastructure access—solidifies this outlook, Maintain BUY rating with a TP of IDR 4,150.

Key highlights

· Resilient ARPU and subscriber base recovery. Blended ARPU surged +32.1% yoy (-0.8% qoq) to IDR 46.9k in 2Q26. Crucially, the subscriber base halted its previous downward trend, stabilizing at 69.4 mn (flat qoq). Data traffic maintained steady momentum, expanding +5.2% qoq to 4,067 PB, reflecting robust user engagement. Top-line revenue for 2Q26 reached IDR 12.17 tn (+3.9% qoq, +16.0% yoy), lifting 1H26 revenue to IDR 24.00 tn—49.7% of our full-year forecast.

· 2026 guidance. Management targets a full-year EBITDA margin in the mid-to-high 40% range, supported by annual merger synergies of USD 250–300 mn that remain on track. For 2H26, management anticipates an additional ~IDR 1.00 tn in accelerated depreciation and has raised its capex target to IDR 20.00 tn (up from IDR 15.00 tn) to support new spectrum deployment.

· Capital-light Ai strategy. EXCL is adopting a distinct, capital-light AI strategy, opting not to deploy significant capex toward internal AI development. Instead, the company will gain full access to the Sinarmas Group’s established AI infrastructure ecosystem. On the commercial front, EXCL launched a partnership with Google in July 2026 to offer prepaid subscribers 6 months of complimentary access to the Gemini Plus package.

· More spectrum, same cost. EXCL secured 30 MHz in the 700 MHz band and 50 MHz in the 2.6 GHz band for an annual fee of IDR 990 bn. To maintain efficiency, EXCL is scheduled to return 15 MHz of its 900 MHz spectrum by December 2026, which carries roughly equivalent carrying costs. This swap allows EXCL to widen its spectrum capacity without incurring incremental OPEX.

MBMA - IMIP site visit notes

MBMA - IMIP site visit notes

Muhammad Fariz

PT Merdeka Battery Materials Tbk

17 December 2024 - 07.00am

MBMA - IMIP site visit notes

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