DBS Telkom: Hold; Rp9,250; TP Rp8,500; TLKM IJ

Consolidate business to further focus on TIME

As a part of its commitment to focus on TIME business, TLKM will divest its 40% stake in Patrakom and 25% in Citra Sari Makmur (CSM) to consolidate corporate resources in satellite business. TLKM plans to develop satellite business specifically in very small aperture terminal (VSAT) through only one subsidiary, Metrasat. Thus, management chose to consolidate its businesses with affiliated companies where TLKM maintains full ownership to enable fast decision-making. CSM management stated that change of ownership as TLKM divest its stake would not affect the company’s business as well as data communication development plan.