Higher Rates May Pressure Indonesia’s Telecom Tower Sector
Bahana Sekuritas cut its sector view to neutral, citing Dayamitra’s floating-rate debt and fixed lease rates as risks to returns.
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what happened
According to Newsmetry API, Indonesian telecom tower companies may face pressure from higher interest rates. Nicolas Lumy, an analyst at Bahana Sekuritas, said Dayamitra Telekomunikasi has a 100% floating-rate debt profile, creating a major risk in an environment of rising borrowing costs.
Tower companies are also tied to long-term contracts with fixed, non-negotiable lease rates. As interest expenses rise while revenue remains fixed, returns will decline, the analyst said. Bahana Sekuritas downgraded its sector rating to neutral from overweight.
The brokerage nevertheless continues to favor Sarana Menara Nusantara because of its strong presence on Indonesia’s Java. Bahana Sekuritas retains a buy rating and a target price of 712 rupiah for the company’s shares. The stock was down 0.9% at 454 rupiah.
why it matters
The sector’s mix of floating-rate borrowing and fixed lease revenue leaves operators exposed to higher financing costs, which can squeeze returns even when revenue does not change.
instruments
sources
- Indonesian Telecom Tower Companies May Be Hit by Higher Interest Rates — Market Talk — Newsmetry API, 13 October 2026 at 05:56 UTC
prepared by the newsmetry newsroom with ai assistance from the sources listed below. not investment advice.
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