Mitratel (MTEL) shares drop from IPO price, analysts explain


ILLUSTRATION. Initial listing of shares of PT Dayamitra Telekomunikasi Tbk (MTEL) aka Mitratel on the Indonesia Stock Exchange, Jakarta (22/11).

Reporter: Nur Qolbi | Editor: Anna Suci Perwitasari

KONTAN.CO.ID – JAKARTA. The share price of PT Dayamitra Telekomunikasi Tbk (Mitratel) fell 4.37% to Rp 765 per share on its first trading day, Monday (22/11). Even so, the share price of the company coded MTEL managed to close up 1.31 percent to Rp 775 per share on Tuesday (23/11).

In fact, usually stocks that have just been listed on the Indonesia Stock Exchange recorded a significant price increase on the first day of trading. In fact, some are often affected auto reject top (ARA).

Kiwoom Sekuritas Indonesia analyst Sukarno Alatas assessed that the decline in MTEL was due to prices intial public offering (IPO) of Rp 800 per share is considered higher than the industry average price. This assessment is seen from price earning ratio (PER) and EV/EBITDA ratio based on the latest annualized financial performance.

“The price offered by MTEL is above the industry average, which means it is quite expensive,” Sukarno said when contacted by Kontan.co.id, Tuesday (23/11).

According to the calculation, Mitratel’s EV/EBITDA is in the range of 15.6 times-19, 9 times, while the average EV/EBITDA of the telecommunications tower industry is 14 times.

Also Read: After the IPO, this is Mitratel’s strategy to boost performance

Moreover, this decline was due to attitude wait and see Market players. In other words, investors are still not optimistic about the company’s future prospects. “So the price needs to go down first so that investors can see it,” said Sukarno.

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So far, he advised market participants to wait and see first. Investors can enter this stock when the brokers have started to accumulate massive purchases or wait for the clarity of the direction of the trend movement.

Meanwhile, analysts at Verdhana Sekuritas Indonesia Nicholas Santoso and Raymond Kosasih made recommendations buy on MTEL with a target price of Rp 1,200 per share. This recommendation is given in line with the potential development of Mitratel in the future.

The prospect of growth in the tower sector in Indonesia will be driven by strong data traffic and the implementation of 5G services.

“The opportunity for tower growth and the scarcity of tower assets contributed to the upward trend in tower valuation,” said the two analysts in a research received by Kontan.co.id, Tuesday (23/11).

According to the two analysts, 57.3% of Mitratel’s total 28,030 towers are located outside Java with a collocation ratio of (tenancy ratio) is currently 1.39 times. The ratio is lower than tenancy ratio tower on the island of Java which is 1.64 times.

This condition provides growth opportunities for Mitratel towers, especially those outside Java. While overall, tenancy ratio Mitratel tower is 1.50 times with the number of tenants reaching 42,016.

Verdhana Sekuritas also provides estimates, compound annual growth rate (CAGR) Mitratel’s net profit for 2021-2023 can reach 44.8% with a revenue CAGR of 10%.

Compared to other telecommunications tower companies, Mitratel has a ratio net debt the lowest EBITDA of 0.98 times. This condition makes Mitratel very flexible to carry out various acquisitions in the future.

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