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Perusahaan Listrik Negara
- Sector: Energy
- Sub Sector: Independent Power Producers
- Region: Indonesia
- Bond: PLNIJ 4.125 27
- Indicative Yield-to-Maturity (YTM): 4.29%
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Fundamental View
AS OF 17 Dec 2025- PLN enjoys extremely strong ties with the Government of Indonesia (GoI) given its critical policy role of electrifying the nation. Post the launch of Indonesia’s sovereign wealth fund Danantara, PLN is now indirectly owned by the GoI through Danantara.
- PLN delivered a robust set of 1H25 results, with total revenue and EBITDA up 5% and 9% YoY respectively driven by resilient power demand across Indonesia
- Looking ahead, we expect PLN’s credit metrics to improve in FY25 supported by higher YoY EBITDA, though partially weighed upon by higher capex; we anticipate FY25 EBITDA growth to be in the mid to high single-digit % YoY, mainly attributable to Indonesia’s healthy economic growth, supporting power demand; we also expect power tariffs to remain flat.
Business Description
AS OF 17 Dec 2025- PLN is involved in the entire electricity value-chain, from power generation, to transmission, distribution and retail.
- It alone accounts for 76% (~47 GW) of Indonesia's generation capacity (of which 8 GW is renewable capacity), while IPPs provide the remainder.
- The company controls and operates the entire transmission and distribution network in the country. It is the sole buyer of electricity produced by IPPs, through power purchase agreements (PPAs).
- It sells electricity to well-diversified off-takers – 41% to households, 25% to industrial customers, 21% to businesses and 12% to others.
- Since 2015, the GoI has gradually implemented monthly tariff adjustments for 13 customer groups, so that rates charged to customers are better matched with production costs.
- However, under the Public Service Obligation (PSO), the company will continue to sell electricity at subsidized rates of 50% to 450-volt amperes (VA) power households and 25% to 900 VA power households. The GoI subsequently reimburses the company for the difference between the subsidized tariff rate and production cost, typically within 2-3 months.
Risk & Catalysts
AS OF 17 Dec 2025- The company provides subsidized electricity to certain households for which it subsequently receives reimbursements from the GoI; though these payments tend to get delayed during major events such as COVID-19 pandemic.
- In order to increase the country’s electrification ratio to 97%, the company had been mandated by the GoI to develop large electricity capacities through the Fast Track II and 35,000 MW Programs. Implementation of such complex programs has required significant capital expenditure, which has led PLN’s FCF to fall deep into the red in recent years and created a funding gap.
- The success of the above programs is also contingent on the company’s ability to source coal cheaply, select quality contractors, acquire land rights and receive adequate subsidy reimbursements from the GoI.
- Being primarily a thermal power producer, PLN may be viewed unfavourably from an ESG perspective.
Key Metric
AS OF 17 Dec 2025| IDR bn | FY22 | FY23 | FY24 | 1H24 | 1H25 |
|---|---|---|---|---|---|
| Debt to Book Cap | 28.9% | 27.8% | 27.3% | 27.5% | 27.2% |
| Net Debt to Book Cap | 25.2% | 23.7% | 23.0% | 25.4% | 23.9% |
| Debt/Total Equity | 40.7% | 38.5% | 37.5% | 38.0% | 37.3% |
| Debt/Total Assets | 24.6% | 23.4% | 22.5% | 22.9% | 22.1% |
| Gross Leverage | 4.1x | 4.1x | 3.6x | 4.1x | 3.4x |
| Net Leverage | 3.5x | 3.5x | 3.0x | 3.8x | 3.0x |
| Interest Coverage | 4.5x | 3.7x | 3.9x | 3.4x | 3.9x |
| EBITDA Margin | 31.2% | 27.6% | 30.4% | 29.8% | 30.9% |
CreditSights View
AS OF 27 Jan 2026PLN (Perusahaan Listrik Negara) is a resilient, quasi-sovereign utility, making it a core defensive recommendation primarily due to its monopolistic dominance and critical role in powering Indonesia’s economy. The company’s credit strength is built on foundational operations across the entire electricity value chain—generation, transmission, and distribution—providing predictable cash flows and protection through established government subsidy mechanisms. Complementing this stability is its strategic alignment with national development goals, now reinforced by its indirect ownership under the sovereign wealth fund, Danantara, which supports its capital-intensive transition toward renewable energy and the ambitious 2034 power supply plan. This deep integration with the state not only mitigates execution risks associated with its elevated capital expenditures but also ensures robust financial backing, allowing PLN to sustain healthy credit metrics—recently improving net leverage to 3.0x—positioning it to benefit substantially from Indonesia’s resilient power demand and long-term economic expansion.
Recommendation Reviewed: January 27, 2026
Recommendation Changed: December 06, 2024
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