TLKM The GoTo Markdown That Hurt Q1 Reversed Into a Gain This Quarter

The Same Volatile Line That Hurt Last Quarter Helped This One

Q1's post flagged a single P&L line - the unrealized mark-to-market on Telkomsel's GoTo stake - as the reason operating profit looked like it fell 9.3% when the underlying telecom business barely moved. That line just proved the point about volatility: it swung from -Rp893 billion in Q1 to a +Rp294 billion cumulative gain by H1, meaning Q2 alone saw a roughly +Rp1,187 billion swing back up as GoTo's newly-listed shares moved higher off their IPO price. Operating profit grew 3.4% YoY to Rp12,325 billion, and net income attributable to owners grew 11.7% to Rp7,192 billion - both benefiting from the reversal, the mirror image of Q1's headwind.

Strip the GoTo line out entirely and the underlying business still looks healthy: revenue grew 3.5%, and the Enterprise segment turned profitable again (Rp251 billion, 5.5% margin), its second positive quarter across this dataset's two-year tracking history after Q3 2021's Rp575 billion - a genuinely different, more encouraging pattern than the one-quarter-then-reverse story FY2021's post had to report.

The Prescription

Telkom should keep disclosing the GoTo mark-to-market line explicitly every quarter, the way it did this quarter and last - this is exactly the kind of volatile, non-operating swing a reader needs isolated to judge the underlying business correctly, and two consecutive quarters of large opposite-direction moves (-Rp893bn, then +Rp1,187bn) is proof the volatility isn't a one-off. Telkom deserves credit for keeping this line visible in the P&L rather than netting it into a vaguer "other income" bucket.

Telkom should treat Mobile's margin volatility as the quarter's real open question, not Enterprise's or GoTo's swings. Mobile's margin recovered sharply this quarter (30.9% to 39.7% - see Segment Comparison) after Q1's sharp drop, so the real watch item is whether Q1's compression was the anomaly or this quarter's recovery is. Either way, back-to-back quarters of a near-9-point margin swing in Telkom's largest segment deserves a disclosed explanation, the same standard this dataset has held Enterprise to since Q1 2020.

Key Financial Metrics

Q2 2022 (three months ended Jun 30, 2022) vs Q2 2021, consolidated - discrete-quarter figures derived by subtracting Q1 from each year's H1 cumulative filing

FX: approximately Rp14,922 = US$1 (Jun 30, 2022) and Rp14,602 = US$1 (Jun 30, 2021) - quoted market rates for each date, used only to convert the USD columns below.

Metric	Q2 2022 (Rp)	Q2 2022 (US$)	Q2 2021 (Rp)	YoY (Rp)	YoY (US$)
Revenue	Rp36,775B	~$2,464.4M	Rp35,535B	✅ +3.5%	✅ +1.3%
Adjusted EBITDA»	Rp21,335B	~$1,429.8M	Rp19,328B	✅ +10.4%	✅ +8.0%
Operating Income»	Rp12,325B	~$825.9M	Rp11,916B	✅ +3.4%	✅ +1.2%
Net Income (attributable to owners)	Rp7,192B	~$482.0M	Rp6,437B	✅ +11.7%	✅ +9.3%
Free Cash Flow» (OCF - capex)	Rp7,143B	~$478.7M	Rp7,460B	⚠️ -4.2%	⚠️ -6.3%
Total Cash	Rp40,160B	~$2,691.1M	Rp36,613B	✅ +9.7%	✅ +7.3%

FCF fell slightly despite EBITDA growth, on continued elevated capex (Rp9,184 billion discrete-quarter, up from Q1's Rp8,469 billion) - the reacceleration flagged consistently since FY2021's post. Net income's 11.7% growth outpaced operating income's 3.4%, a gap explained by items below the operating-profit line, including finance costs and tax - not by the GoTo line, which already sits above operating profit.

The GoTo mark-to-market line that hurt Q1's headline number helped this one, and Enterprise turned profitable for a second time in this dataset's history - but Mobile's margin volatility (down sharply in Q1, up again this quarter) is now the more interesting open question than either. See Target Valuation Range for what the market is pricing in.

Key Operational Metrics

• IndiHome subscribers: 8.9 million, up 288,000 net additions across 1H22 - continued growth, broadly in line with the deceleration flagged in Q1's post
• Capital expenditure (discrete quarter, derived): Rp9,184 billion, up from Q1's Rp8,469 billion
• Mobile subscriber count: not separately disclosed in this quarter's presentation

Segment Comparison

Q2 2022 vs Q2 2021, discrete-quarter figures derived by subtraction from cumulative filings

Segment	External Revenue Q2'22	External Revenue Q2'21	YoY	Segment Result Q2'22	Margin Q2'22	Margin Q2'21
Mobile	Rp21,429B	Rp21,066B	➖ +1.7%	Rp8,512B	✅ 39.7%	36.3%
Consumer (IndiHome)	Rp6,567B	Rp6,135B	➖ +7.0%	Rp1,182B	🔴 18.0%	27.9%
Enterprise	Rp4,522B	Rp4,572B	➖ -1.1%	✅ Rp251B	✅ 5.5%	-5.3%
WIB	Rp4,018B	Rp3,550B	✅ +13.2%	Rp2,256B	⚠️ 56.1%	66.9%
Others	Rp54B	Rp79B	⚠️ -31.6%	-Rp255B	n/m	n/m
Total segment	Rp36,590B	Rp35,402B	➖ +3.4%	Rp11,946B	32.7%	32.6%

Mobile's margin recovery (30.9% in Q1 to 39.7% this quarter, per the segment note's own comparable-period figures) confirms Q1's compression was likely a one-quarter event rather than a new trend - a genuinely different read than Q1's post could offer at the time. Consumer's margin fell sharply (27.9% to 18.0%), the segment's weakest margin in this entire dataset - worth watching closely next quarter.

Mobile

Margin recovered to 39.7%, its strongest in over a year, on essentially flat revenue - suggesting Q1's compression (see that post) was a cost-timing effect rather than a structural shift.

Consumer (IndiHome)

Revenue grew a modest 7.0%, but margin collapsed to 18.0% from 27.9% a year earlier - the segment's weakest quarter on margin across this entire dataset, a genuine concern given Consumer had been Telkom's most consistent growth story since FY2020.

Enterprise

Profitable for a second time in this dataset's tracking (Rp251 billion, 5.5% margin) - see The Prescription for why this reads as more encouraging than Q3 2021's since-reversed profit.

WIB (Wholesale and International Business)

Revenue grew fastest of any segment (+13.2%) though margin compressed to 56.1% from 66.9% - still the second-highest-margin segment after Mobile's recovery this quarter.

Beyond the Usual

Telkomsel's GoTo Stake Swung From a Rp893 Billion Loss to a Net Rp294 Billion Gain in One Quarter

The unrealized fair-value line flagged in Q1's post reversed hard: H1 2022's cumulative figure is a +Rp294 billion gain, meaning Q2 alone contributed roughly +Rp1,187 billion as GoTo's newly-listed shares traded above their IPO offering price during the quarter. This confirms the position remains genuinely volatile and continues flowing through operating profit every quarter under its FVTPL classification - a reader relying on the reported operating-profit line alone would have concluded the business deteriorated in Q1 and then improved sharply in Q2, when in both cases the swing was mostly about GoTo's own share price, not Telkom's core operations.

Governance and Corporate-Structure Changes Landed as Subsequent Events

The subsequent-events note discloses a leadership change (Harry Suseno Hadisoebroto succeeded as Senior VP of Internal Audit, effective July 1, 2022), a subsidiary renaming (PT Sigma Tata Sadaya became PT Telkom Data Ekosistem), and a new President Director appointment at PT Industri Telekomunikasi Indonesia - routine governance housekeeping with no disclosed financial impact, noted here mainly because the pace of subsidiary-level corporate actions (Mitratel's IPO, GoTo's listing, and now these) has been unusually high across this dataset's 2021-2022 coverage.

Target Valuation Range

Bottom line: roughly Rp3,090-Rp5,280 fair-value range (bear-to-bull, TTM EV/EBITDA-based) against a Rp4,000 actual close - the stock pulled back from Q1's highs even as TTM EBITDA and earnings both grew, a genuine disconnect worth watching.

Telkom's shares closed Q2 2022 at Rp4,000, down 12.7% from Q1's Rp4,580 close (see that post) despite this quarter's operating improvement - a real pullback that doesn't track the fundamentals, echoing the disconnects flagged in Q3 2020's and Q2 2021's posts. Over the trailing 2 years (July 2020 through June 2022), the stock moved from a Rp3,050 close to Rp4,000, a 31.1% net gain.

Market cap → enterprise value	Q2 2022 (period-end)
Share price (period-end)	Rp4,000
Shares outstanding	99,062,216,600
Market capitalization	~Rp396,249 billion (~$26.6 billion)
Plus: total debt	Rp61,464 billion
Less: cash	Rp40,160 billion
Enterprise value	~Rp417,553 billion

Peer-multiple sanity check	Q1 2022	Q2 2022 (TTM)	Change
TTM EPS	Rp250.98	Rp258.61	✅ up
P/E	~18.3x	~15.5x	✅ down
Book value per share (owners)	~Rp1,289.9	~Rp1,213.8	⚠️ down (dividend effect likely)
P/B	~3.55x	~3.30x	✅ down
TTM Adjusted EBITDA	Rp78,981B	Rp80,988B	✅ up
EV/EBITDA (TTM)	~5.8x	~5.2x	✅ down

Every multiple compressed even as TTM earnings and EBITDA both grew - the price decline, not the operating trend, explains the move, meaning the stock genuinely got cheaper on a trailing-fundamentals basis this quarter. Applying the same mature-telecom EV/EBITDA range used throughout this dataset:

Scenario	Key assumption	Multiple	Implied EV	Implied price
Current (Q2 2022 close)	actual market price, for reference	~5.2x TTM Adjusted EBITDA	~Rp417,553 billion	Rp4,000
Bear	Consumer's margin collapse (see Segment Comparison) proves structural and the multiple compresses further	~4.5x	~Rp364,446 billion	~Rp3,091
Base	Multiple holds near current levels as the market stays cautious pending confirmation on both Consumer's margin and Enterprise's durability	~5.5x	~Rp445,434 billion	~Rp3,878
Bull	Enterprise's second profitable quarter and Mobile's margin recovery both prove durable, re-rating the multiple toward the top of the historical range	~7x	~Rp566,916 billion	~Rp5,279

The current close sits between bear and base, closer to base - a market pricing in real caution about Consumer's sudden margin weakness even while giving some credit for Enterprise's second consecutive profitable-adjacent quarter.

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