From coal to connectivity. PT Dian Swastatika Sentosa Tbk (DSSA) is transitioning its business model from coal dependence toward digital infrastructure and communications within Sinar Mas ecosystem. Currently, management is targeting >30% revenue contribution from non-coal segments within the next 3–5 years, although coal still contributed over 90% of DSSA’s revenues in 1Q25. On the telco-tech arm side, we see rapid growth with revenues projected to grow +75.1% YoY in 2025F and deliver +67.0% CAGR over 2022-2027F, driven by rising subscriber base and homepass expansions, through  MyRepublic broadband (1Q25: 6.8mn homepasses, 914k subscribers) and SM+ data centers (10MW operational, 18MW under construction).

 

Telco and technology as key re-rating drivers. Through aggressive expansions, DSSA has become Indonesia’s #2 fiber-to-home broadband provider, trailing only Telkom’s IndiHome, with footprint spanning 70+ cities. Subscriber growth accelerated +88.6% YoY in 1Q25, while homepasses nearly doubled to 7.6mn. To support its telco-tech evolution, SM+ is developing Jakarta’s first Tier IV AI-ready metro data center (SMX01) with 18MW initial capacity (COD end-2026), supplementing existing 24 locations. DSSA also leverages synergies within the Sinar Mas ecosystem, benefitting from 310 Gbps satellite capacity, fintech platforms with 100mn+ users, and potential collaboration with XLSmart (EXCL–FREN merger) to strengthen its mobility and connectivity offerings.

 

Renewables provide long-term growth support. Beyond digital infrastructure, DSSA is investing in geothermal and solar energy, with earnings contributions expected to materialize over the longer term. Its geothermal portfolio spans six fields (Cipanas, Cisolok, Nage, Jambi, West Sumatra, and Central Sulawesi), all under a JV with EDC with combined potential capacity of 440MW. On the solar side, DSSA operates Indonesia’s first integrated solar cell and module plant (1GW capacity, expandable to 2GW) and is developing customized PV projects totaling 40MWp. While still in the early stages compared to coal and telco-tech operations, these initiatives provide strategic exposure to Indonesia’s energy transition, reinforcing DSSA’s alignment with long-term ESG-focused capital.

 

SPEC BUY on DSSA with TP of IDR 150,000/share. We assign SPEC BUY on DSSA with MSCI-inclusion-backed target price of IDR 150,000/share, offering +56% upside. Recent inclusion in the MSCI Indonesia Global Standard Index has provided the stock with liquidity boost, strong momentum and investor interest, attracting foreign inflows. Combination of DSSA's rapidly expanding telco-tech portfolio and renewables exposure sets the stage for long-term growth support. However, company-related risks regarding regulatory approvals for its data centers, renewables execution, and coal price fluctuations remain.