DNET Net Income Tripled. The Stock Fell Anyway.

The Recovery That Still Isn't Complete

PT Indoritel Makmur Internasional Tbk closes out fiscal year 2021 — the second full year of the pandemic in Indonesia — with the mirror image of the previous post's story. Where FY2020 showed three associate stakes absorbing the same shock in three genuinely different ways, FY2021 shows all three recovering at once, just not equally. Indomaret's own net profit attributable to owners nearly doubled, up 83.1% to Rp1,965.8 billion, as store footfall and distribution both expanded again. Sari Roti's profit grew a healthier 30.8% to Rp281.3 billion. And Fast Food Indonesia — the dine-in, mall-dependent KFC franchisee that swung to a Rp377.2 billion loss last year — narrowed that loss by 21.6% to Rp295.7 billion, still a loss, but a smaller one. The Company's combined share of associate profit rose 116.26% to Rp748.5 billion, and consolidated net income more than tripled, up 201.07% to Rp984.7 billion, on a business the Company itself directly runs (FiberStar) that also grew revenue 72.72%.

None of that showed up in the share price. DNET closed 2021 at Rp3,280, down 3.2% from Rp3,390 a year earlier — the stock fell in the same year net income roughly tripled. This isn't the first time this backlog has shown the market ignoring a swing in this Company's fundamentals (see Target Valuation Range below for just how much cheaper that made the implied Indomaret stake look), but it's the sharpest version of it yet: a business recovering everywhere at once, and a stock that didn't care either direction.

The Prescription

FiberStar's underlying growth keeps validating the thesis from the last post: home-passed^» coverage grew 40.9% to 925,964 and home-connected subscribers grew 63.17% to 269,727, pushing the connect-through rate from 25.2% to 29.1% — the backlog is still converting to paying subscribers faster than the network itself is expanding. Management should keep funding this buildout, and should specifically use the sharply improved operating cash flow (see Key Financial Metrics below) to fund it with the Company's own balance sheet rather than structures that dilute its ownership further — see below.

What it should stop doing: this is now the second year running that FiberStar's ownership structure has diluted while the Company keeps calling it the lever it controls, and 2021 makes the pattern worse, not better. The Company's own direct-plus-indirect stake in PT Mega Akses Persada ("MAP," the entity that actually owns FiberStar) fell from 71.88% at the end of 2020 to 66.76% at the end of 2021 — a real five-percentage-point drop in one year — as minority co-shareholder PT Mega Akses Perkasa ("MAK") converted another Rp57.5 billion of mandatory notes into MAP equity in December 2021, and signed a new agreement in July 2021 to acquire a further Rp145 billion of MAP shares (see Beyond the Usual). If FiberStar really is the one asset worth funding aggressively, the Company can't keep financing its growth through a structure that hands an ever-larger share of it to someone else — the trend flagged a year ago hasn't just continued, it's accelerated.

Key Financial Metrics

FY 2021 vs. FY 2020, consolidated

FX: IDR 14,269 = USD 1 (December 31, 2021 rate) and IDR 14,105 = USD 1 (December 31, 2020 rate), both per the Company's own financial statements.

Metric	FY 2021 (IDR)	FY 2021 (USD)	FY 2020 (IDR)	YoY
Revenue	Rp844.412B	~$59.18M	Rp488.888B	✅ +72.72%
Share of profit of associates	Rp748.484B	~$52.46M	Rp346.101B	✅ +116.26%
Operating Income»	Rp1,003.284B	~$70.32M	Rp385.244B	✅ +160.43%
Net Income»	Rp984.670B	~$69.02M	Rp327.053B	✅ +201.07%
Net income attributable to owners	Rp943.114B	~$66.10M	Rp328.828B	✅ +186.81%
Total comprehensive income	Rp940.123B	~$65.89M	Rp465.685B	✅ +101.88%
EPS (basic)	Rp66.49	~$0.00466	Rp23.18	✅ +186.84%

Balance sheet / cash flow	FY 2021 (IDR)	FY 2021 (USD)	FY 2020 (IDR)	YoY
Total Assets	Rp18,046.214B	~$1.265B	Rp17,223.362B	✅ +4.78%
Total Liabilities	Rp6,825.270B	~$478.4M	Rp7,087.541B	✅ -3.70%
Total Equity	Rp11,220.944B	~$786.5M	Rp10,135.821B	✅ +10.71%
Total bank loans	Rp6,378.185B	~$447.1M	Rp6,853.507B	✅ -6.94%
Cash and cash equivalents	Rp440.052B	~$30.84M	Rp177.359B	✅ +148.11%
Operating cash flow	-Rp47.696B	~-$3.34M	-Rp310.072B	✅ Use eased 84.6%
Free Cash Flow» (op. cash flow - capex)	~-Rp434.570B	~-$30.46M	~-Rp785.128B	✅ Use eased 44.6%

"Adjusted EBITDA" still isn't a metric this Company reports, and it still doesn't map onto a pure holding company's accounts — Operating Income above embeds Rp748.5 billion of non-cash equity-method associate profit, more than doubling from Rp346.1 billion in 2020, so an EBITDA add-back would double-count a recovery that has nothing to do with FiberStar's own cost structure.

Every line item improved this year, not just net income — total liabilities fell 3.70% as bank loan principal was paid down (Rp6,378.2 billion outstanding, down from Rp6,853.5 billion), and the ratio of liabilities to equity fell from 69.93% to 60.83%. Free cash flow improved to roughly negative Rp434.6 billion from negative Rp785.1 billion, continuing the same trajectory as last year — still burning cash on a capital-intensive buildout (capex of Rp386.9 billion in 2021, itself down from Rp475.1 billion), but burning meaningfully less of it. Receivables collectability improved again, to 118 days outstanding from 138 days.

FiberStar's Segments: Retail Holds Its Gains, One Customer Now Owns Half the Revenue

FiberStar's own revenue splits into three reported segments: Corporate (fiber connectivity sold to telcos, banks, and enterprises), Retail (FTTH broadband to homes), and Other (access-point rental income plus e-commerce daily deals). The Company states plainly that it "cannot present profitability per business segment" because assets are managed centrally and not allocated by segment — a genuine disclosure limitation, not new this year.

Segment	2021 Revenue	2020 Revenue	YoY	% of Total 2021
Corporate	Rp430.157B	Rp263.888B	✅ +63.02%	50.9%
Retail	Rp351.715B	Rp197.475B	✅ +78.11%	41.6%
Other	Rp62.540B	Rp27.547B	✅ +127.03%	7.4%
Total	Rp844.412B	Rp488.888B	+72.72%	100%

Retail grew faster than Corporate again (78.1% vs. 63.0%), continuing the shift toward home broadband that the pandemic accelerated, though the mix itself barely moved (41.6% of revenue this year vs. 40.4% last year) since Corporate also grew a healthy 63%. The Other segment — still folding in the e-commerce business OgahRugi alongside access-point rental income without a separate figure for either, as flagged a year ago — more than doubled its revenue and its share of the mix, from 5.6% to 7.4%, though a reader still can't tell how much of that growth is OgahRugi versus rental income.

The more concrete change this year is customer concentration: PT Cyberindo Aditama alone accounted for 50.70% of total revenue in 2021, up from 47.39% in 2020 — for the first time in this backfill, a single counterparty represents more than half of everything FiberStar bills. PT XL Axiata Tbk, which was a disclosed 9.57%-of-revenue customer last year, no longer clears the 10% disclosure threshold at all this year (see Beyond the Usual).

Key Operational Metrics

• FiberStar Home Passed^»: 925,964 (2021) vs. 656,975 (2020), ✅ +40.9%
• FiberStar Home Connected: 269,727 (2021) vs. 165,305 (2020), ✅ +63.2% — connect-through rate improved to ~29.1% of homes passed, from ~25.2% in 2020
• FiberStar fiber-optic length: 31,035 km vs. 28,714 km, ✅ +8.1%
• FiberStar city/regency coverage: 135, unchanged from 2020
• Trade receivables collectability: improved to 118 days outstanding (2021) from 138 days (2020)
• Ownership stakes (equity-method associates): Indomarco Prismatama (Indomaret) 40%, Fast Food Indonesia (KFC) 35.84%, Nippon Indosari Corpindo (Sari Roti) 25.77% — all unchanged
• FiberStar consolidation: the Company's direct-plus-indirect stake in PT Mega Akses Persada (MAP) fell to 66.76% (63.44% direct + 3.32% via PT Indoritel Persada Nusantara) from 71.88% in 2020 — see Beyond the Usual
• Not available this quarter: standalone ARPU or take rate broken out by retail vs. corporate customer; OgahRugi's own revenue, still not separately disclosed.

Two Associates Recover, One Still Bleeds

Indomaret, Sari Roti, and Fast Food Indonesia remain equity-method^» associates rather than consolidated segments, each disclosing its own full financial statements in the Company's footnotes. FY2021 is the year the divergence from last year's report starts closing, but doesn't fully close.

Associate	2021 Net Sales	2020 Net Sales	2021 Profit (Owners)	2020 Profit (Owners)	Profit YoY
Indomarco Prismatama (Indomaret)	Rp90,601.737B	Rp86,121.454B	Rp1,965.777B	Rp1,073.613B	✅ +83.10%
Nippon Indosari Corpindo (Sari Roti)	Rp3,287.623B	Rp3,212.035B	Rp281.341B	Rp215.051B	✅ +30.83%
Fast Food Indonesia (KFC)	Rp4,840.596B	Rp4,840.364B	-Rp295.738B	-Rp377.185B	⚠️ Loss narrowed 21.6%

Indomaret's net sales grew a modest 5.20%, but profit nearly doubled — a minimarket chain that was already resilient in 2020 got the operating leverage back as restrictions eased, without needing much more revenue to do it. Sari Roti's sales barely moved (+2.35%) but profit still grew 30.8%, the same pattern at smaller scale. Fast Food Indonesia is the one holdout: revenue was essentially flat (+0.005%) even as the loss narrowed, meaning the improvement came from cost control and easing restrictions on capacity, not a real recovery in KFC's dine-in traffic. The Company's equity-method pickup of FAST's loss — roughly Rp108.4 billion, consistent with its 35.84% stake — is still a drag on consolidated net income, just a much smaller one than the Rp137.6 billion drag it was a year ago.

Beyond the Usual

FiberStar's ownership kept diluting — and the pipeline for further dilution just got bigger

The Company's direct-plus-indirect ownership of PT Mega Akses Persada ("MAP," the entity that actually owns FiberStar) fell from 71.88% (68.30% direct plus 3.58% via subsidiary PT Indoritel Persada Nusantara) at the end of 2020 to 66.76% (63.44% direct plus 3.32% via IPN) at the end of 2021 — a five-percentage-point drop in twelve months. The mechanism is the same one flagged in the previous post: PT Mega Akses Perkasa ("MAK"), a minority co-shareholder in MAP, holds mandatory convertible notes that increase MAP's issued capital — and only MAK's — every time they convert. In December 2021, MAK converted a further Rp57.5 billion of notes, lifting MAP's issued capital from Rp750.2 billion to Rp807.7 billion and increasing non-controlling interests^» on the Company's balance sheet by Rp21.2 billion. Separately, in July 2021 MAK signed a new agreement to acquire a further Rp145 billion of MAP shares (portepel) — as of year-end this sat on the balance sheet as an "advance for shares subscription," not yet converted, but committed. The dilution this Company has been absorbing since 2018 isn't winding down as the convertible notes mature; a fresh, larger commitment is already queued up behind it.

One customer now bills for more than half of FiberStar's revenue

PT Cyberindo Aditama's share of the Company's total revenue rose to 50.70% in 2021 from 47.39% in 2020 — the first year in this backfill a single counterparty has crossed the halfway mark. PT XL Axiata Tbk, disclosed at 9.57% of revenue in the 2020 filing, no longer appears at all among customers exceeding the 10%-of-revenue disclosure threshold this year, meaning its share fell below that bar even as FiberStar's total revenue grew 72.72% — XL Axiata's own absolute spend evidently did not keep pace. A fiber-optic network whose revenue growth increasingly rests on one counterparty's continued spending is carrying a concentration risk the headline revenue growth doesn't show.

FiberStar set up a Singapore subsidiary right after the fiscal year closed

MAP established a wholly-owned subsidiary, Fiberstar Pte. Ltd., in Singapore on March 2, 2022 — a subsequent event disclosed in the financial statements, authorized for issuance April 28, 2022. The Company's own materials describe submarine cable links connecting 13 cities/regencies across Sumatra and Java directly to Singapore, so a Singapore-incorporated entity is a plausible extension of that existing international connectivity rather than a new business line, though the filing itself doesn't yet say what the subsidiary will do.

Two smaller items were trimmed from this section rather than given full weight, since neither stands up as a finding on its own: Board of Directors compensation rose 30.7% to Rp16.533 billion (Board of Commissioners rose 5.3% to Rp2.981 billion), roughly tracking the Company's own profit growth; and Indomarco Prismatama (Indomaret) was also a Rp9.826 billion related-party revenue customer of the Company's consolidated business in 2021 (1.16% of total revenue, up from 1.50% in 2020), disclosed as related solely because it's an associate, not because the terms differ from market rates.

Target Valuation Range

Bottom line: mechanically cheaper than a year ago, and this time for a legitimate reason — the underlying profit genuinely grew faster than the share price did. Unlike the previous post's finding of a market getting more expensive on weaker fundamentals, FY2021 shows the opposite: profits roughly doubled or better across the board, and the Company's own P/E fell from ~146x to ~49x purely because earnings caught up while the stock price stood still.

The Company's shares closed 2021 at Rp3,280 (per the Company's own annual report; a publicly quoted closing price checked independently against this figure came in at Rp3,290, an immaterial rounding difference). No stock split has occurred for this ticker since the 2019 filing, so this price remains directly comparable to the Company's own historical reporting.

Market cap → book value	FY2020	FY2021	Change
Share price (period-end)	Rp3,390	Rp3,280	⚠️ down
Shares outstanding	14,184,000,000	14,184,000,000	➖ unchanged
Market capitalization	~Rp48.084 trillion	~Rp46.524 trillion (~$3.26 billion)	⚠️ down 3.2%
Basic EPS	Rp23.18	Rp66.49	✅ up (net income >3x)
P/E»	~146.2x	~49.3x	✅ down sharply
Book value per share (total equity basis)	Rp714.55	Rp791.05	✅ up
P/B»	~4.74x	~4.15x	✅ down

The P/E fell sharply, entirely a function of profit growth rather than any price decline being the driver (the share price barely moved).

Sum-of-the-parts sanity check	FY2020	FY2021
Fast Food Indonesia stake, at market	~Rp1.559 trillion	~Rp1.394 trillion (Rp975/share, live-market quote)
Nippon Indosari Corpindo (Sari Roti) stake, at market	~Rp2.168 trillion	~Rp2.168 trillion (Rp1,360/share, live-market quote)
Non-associate net assets	~Rp0.453 trillion	~Rp0.894 trillion
Sum, excluding Indomaret	~Rp4.180 trillion	~Rp4.457 trillion
Company's market capitalization	Rp48.084 trillion	Rp46.524 trillion
Implied value of 40% Indomaret stake	~Rp43.904 trillion	~Rp42.067 trillion
Implied value of all of Indomaret	~Rp109.760 trillion (~102.2x FY2020 net income)	~Rp105.167 trillion (~53.5x FY2021 net income)

This year's annual report does not itself disclose Fast Food Indonesia's or Sari Roti's own December 2021 closing share prices the way the FY2020 filing did, so the FY2021 column above uses their publicly quoted closing prices as of December 30, 2021 - a live-market data point rather than a figure sourced from a filed document. The implied Indomaret multiple is nearly half of last year's ~102.2x, and this time the reason is straightforward: Indomaret's own profit nearly doubled while the Company's market cap stood still, so the same market price now buys a much cheaper claim on Indomaret's earnings than it did twelve months ago. Public ownership held flat at 8.75% (unchanged from 2020), and quarterly trading volume through 2021 ranged from 859,700 to 1,706,100 shares against 14.184 billion outstanding - still comfortably under 0.02% of shares changing hands in a typical quarter.

A full discounted cash flow model still isn't attempted here, for the same reason as the previous two posts: this Company's fair value depends on three underlying operating businesses' multi-year trajectories, and this is only the third quarter of coverage. The sum-of-the-parts and reverse-valuation reads remain the honest lens for now. Net income tripled and the float still didn't blink — the real number to watch from here isn't Indomaret's recovery, it's the Company's own shrinking claim on the one business it actually runs.

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