SUPR to invest Rp 1.5 t to boost tower business

JAKARTA. Telecommunications tower company PT Solusi Tunas Pratama (SUPR) says it will invest Rp 1.5 trillion (US$154.5 million) in network expansion in hopes of boosting its revenue in 2013.

“We are looking forward to revenue growth of 50 percent this year in comparison to the previous year,” Nobel Tanihaha, the president director of SUPR, said on Tuesday.

The company booked revenue of Rp 351.2 billion in the third quarter of 2012, up 63 percent from the same period in 2011, while its total comprehensive income was up 72.2 percent to Rp 52.5 billion.

Nobel said that the company had set aside Rp 1.5 trillion for capital expenditures to widen its tower network, with Rp 1 trillion earmarked for building new units and the remainder for acquisitions.

The company allocated Rp 500 billion for tower expansions in 2012. “We want to add 1,500 more towers to our collection of 2,246 towers as of 2012,” he said.

Nobel said that the company would build 1,000 new towers and acquire 500 existing towers. “We are nearing our acquisition target, following the purchase of 300 communications towers belonging to PT Hutchison CP Telecommunication [HCPT],” he said.

SUPR and mobile phone operator HCPT closed the deal for the towers on Jan. 10. Nobel said that the company also wanted to boost its tower-leasing business.

The firm had 3,459 tenants at the end of 2012, he said, giving the company a tenancy ratio of 1.62, signifying that each tower was occupied by at least one tenant.

“We aim to have a tenancy ratio of 1.75 this year,” Nobel said, adding that this would translate into 5,775 tenants by the end of the year.

According to Nobel, Solusi Tunas Pratama would continue to focus on Greater Jakarta, where the potential for co-locations, or tower sharing, was greatest.

“As much as 70 percent of our portfolio is located in Jakarta and the surrounding area because this is where the population, and therefore demand for telecommunications infrastructure, is the highest,” he said.

The company serves a majority of the nation’s mobile phone operators, including PT Indosat, PT XL Axiata, PT Telekomunikasi Indonesia and its subsidiary PT Telekomunikasi Selular.

“Our business also depends on the demand for towers from telecommunication operators,” Nobel said.

Also earmarked for expansion in 2013 was the firm’s fiberoptics business, according to Nobel. (Mariel Grazella/ The Jakarta Post)

The company acquired in 2012 PT Platinum Teknologi, a company operating fiber optic networks and microcell poles.

The acquisition gave SUPR a 900-kilometer fiber optic networks spanning from Jakarta to Bandung, West Java.

Nobel said that telecommunication in Jakarta would increasingly rely on fiber optics.

Many telecommunication infrastructure providers have eyed establishing or acquiring fiber optic networks, which allow faster data transmissions, an essential factor in providing broadband Internet. “Fiber optics will become a key business driver in the future,” he said.

As previously reported, PT Telekomunikasi Indonesia (TLKM) announced plans to spend $150 million this year on fiber optic network development to meet the growing demand for data transmission.

The company said it would use more than Rp 21.19 trillion of its internal cash to build a 47,000-kilometer fiber optic network spanning from Aceh to Papua so that Internet access across the country could be equitably fast.