Thank you, Clare. First of all, Happy New Year to all of you. It's a good occasion for us to be here, but unfortunately, I mean, originally we were planning to do it in December, but I'm sure you all know why we delayed it by over a month. Maybe going forward, first part of January would be the one where we will do the Analyst Investors Day every year, and it makes more sense because then we have much more clarity around how we were ending the previous year and what are our plans for the next year. Let me just quickly take you through and revisit what we said last year in our Investor Day and where we are with respect to that and how do we see things going forward here. This was the strategy which we had put across to our investors, converted into two parts.
One was what were business priorities as well as how do we deal with the five vectors of value creation, which was broken down into CelcomDigi as an associate where we would drive synergies, look at the structural transformation in Indonesia because one of the key factors was after the merger between Indosat and Hutch, how do we transition ourselves in Indonesia? Resilience of frontier markets. I think we were still at that point in time going through the tough macroeconomic situation in these markets, even the political situation. How do we manage the frontier markets? How do we create value of the infra businesses, the Link Net as well as the EDOTCO? And how do we eliminate the value of our digital businesses, which are the two businesses, ADA and Boost? And now also adding on is the Axiata Digital Labs.
So those were the five vectors of value creation, and each one of them had a very clear objective to be delivered, which is what we explained to our investors last year. Now, if I go down to the strategy, clearly operational excellence, it's just not about cost, but it's also about how do we allocate capital, how do we manage our balance sheets, how do we ensure that the exposures we have on U.S. dollars and all that is managed. Operating model, one of the things which we did last year was when we set up our portfolio, then we started moving more towards headquarters or corporate center, running these operating companies through empowered boards and ensure that the boards have all the mandate on what is expected as an outcome for each of the operating companies.
Winning culture, I think that's really around how do we transition ourselves as an organization, build a culture which does take into consideration customers, is collaborative enough, and is able to manage the change, which not just the company is going through, but also the industry is going through, and journey to Telco to TechCo is a lot around asset light model, network excellence, how do we use our platform and solutions to build services, and portfolio optimization was around trying to see how we can get market repair, how do we build value of our businesses, including some of them infra and digital businesses, and at the end of it, what do we want to achieve?
We want to achieve MYR 0.10 dividend and keep growing that year on year, be able to give high single -digit shareholder return and balance sheet well managed at less than 2.5x net debt to EBITDA by 2026, so those were the key objectives we had put for ourselves, and across these subsequent slides, I'll try and explain where we are with respect to all the efforts made in 2024. Let me start with briefly 2023. I think I'll not cover this. I think you are familiar with 2024. We've been able to manage our balance sheet well. We've seen the net debt coming down. We've also restructured our corporate center. We are also looking at how overall debt levels come down. The net debt to EBITDA has been reduced to 2.59x in the quarter three and also good cash flow generation in the year up to quarter three 2024.
And this basically moving us towards what we want to achieve, sustainable dividend and sustainable balance sheet. That's the objective we want to achieve. I think this was one of the important parts of our structural transformation of Indonesia, which is to look at long-term sustainability of business in XL. As you know, I mean, we were short on the spectrum. We were subscale as an operating company. So how do we ensure that we build an operating company which is sizable enough, has synergies, capability of building synergies, has spectrum which is sufficient enough to compete in an active competitive market, which is in Indonesia? So we announced this on 10th of December. I think all of you are familiar with very clear objectives, scale, which we get by having at least 27% of customer market share, synergies, expectations around $300 million-$400 million post-completion of integration.
I think we are looking at least two to three years for the integration to be completed, and I think the third point to me is extremely important. The combination of a local business, family business environment, business house which understands the local market so well, combined with the international expertise or regional expertise of running telcos, which we bring on the table, is really, in my view, a very good combination because we just not only tap into the local market, a local understanding, but also bring the technology and competence which Axiata brings with their experience across into this partnership we've entered into, and of course, the intention is not to just do a merger and drive aspirations to just become number one or number two player. I think we want to grow profitably.
As the intention of growth profitably, in our view, would mean that we would and expect the market also to continue bringing resilience, ensuring that the ARPUs are not unnecessarily diluted in the market. If we see that happening, then we would fundamentally see how the market start looking at the telcos quite differently in Indonesia. In addition to that, I think we also do get, as part of the equalization around $475 million, primarily to be used for the purpose of paring down the debt at the group level. I think I've touched a little bit around this. The subscribers, 94.5 million. We will have a combined revenue around $2.8 billion and $1.84 billion of EBITDA. Not very different when it comes to the customer base between us and the second telco in the market.
And I think we should be able to get the benefit of synergies and redeploy some of those benefits of synergies into expanding our position in the markets where we may not have the best network available and strengthen that network here. I think Indonesia, again, three things we looked at on what is structural transformation of Indonesia and what do we expect out of that. One was really the organic part. I think we've seen a fairly good development on ARPU through the process of market repair. I think we've seen last one, one and a half quarters, some bit of a stress where the ARPU has been flattening or marginally coming down. But overall, the growth of ARPU from something like IDR 37,000 back in 2022, we are now at around IDR 42,000 ARPU, which is around 10% growth in ARPU.
Direct distribution, I think as a company, we decided to have direct engagement with our point of sales in Indonesia by cutting the dealer network. Now, advantage of that is two. One is obviously clearly cost saving, which I think was a clear benefit which we've seen, and that's also reflective in terms of the marketing and the acquisition costs in Indonesia. But in addition to that, it also gives us a very strong visibility of what's happening in each point of sale, so whatever intervention we require to improve the productivity of point of sale can be done because we've got a direct access to the outlet versus kind of depending fully on the dealer's ability to perform. And third part, again, is very important in Indonesia, which is really how do you move your revenue into the digital channels.
Indonesia is a peculiar market where actually the retailers decide what price they should sell the product and they mark up when they sell the product. By using the digital channels, you're actually giving the customers right price of what the product needs to be offered, which does help customers able to actually pay a lower amount, but they get the same value or we get the same value, which otherwise we would get through the dealer or the distribution channels, and I think site profitability, clearly the finance team in Indonesia has been focused on driving site profitability, and we've seen substantial improvement on number of sites which are now profitable, not just on the EBITDA, but at the EBIT level. So that was one, which was the organic initiative. Second one was the de-layering. I think you've heard of that Link Net becoming a fiber company.
All customers have been moved to XL, which clearly makes Link Net as a wholesale fiber company and XL as a ServeCo. The last one as part of that was how do we solve the mobile challenge, which is really subscale operations of the mobile business by going ahead with the merger with Smartfren. Frontier markets, again, challenges in frontier markets. I think we've done well in terms of getting the market repair coming in, Dialog and Smart. I think Robi's been somewhat impacted in the last five, six months because of the political situation and the economy going through a reset because of the new government coming into place. We think that's going to be a temporary phenomenon because people are just wait and watch on what they should do. But all other markets, Dialog, we've seen a substantial improvement in ARPU.
Smart, we've seen the improvement in ARPU. Focus around cost. I think that's something which all the companies have been driving well, which is basically reflective if you see the next point in terms of their operational performance. I mean, Robi, while growing at 2.2%, has seen a 14.4% growth in EBITDA. Dialog, despite getting the lower EBITDA margin business post-merger with Airtel, still showing a growth in EBITDA and Smart at a 9.8% revenue growth and 19.9% EBITDA growth. Very strong performance coming from the three frontier markets despite the macro and the political situations we're dealing with, but one important factor was the risk on the balance sheet. I think that's something which we really focused on bringing down, not just the net debt to EBITDA, but also exposure in U.S. dollar in these markets.
I mean, if you look at the debt in Robi, USD debt exposure has been brought down from 76 to 35. Dialog also brought it down substantially, but because post-merger, we did get some of the USD debt coming in from Airtel. So you don't see that significant impact. And Smart has been net cash positive. In fact, something which we were discussing in the morning today, if I add the total USD amongst all these three companies, we would actually be positive in terms of the USD cash balance versus exposed to the USD in the frontier markets. But I think the opportunities, clearly market repair, will remain our focus, cost excellence, network collaboration.
I think we are looking at opportunities of collaborating with our other operators in the markets, improving capital productivity, which in my next presentation, I'll talk about how that's been and U.S. exposure. I think Sri Lanka is coming out of the difficult times with the fundamentals showing very, very strong development. I think even in Bangladesh, we should start seeing the reforms having its positive effect. Some of them also would include on how the licensing for the MNOs has been dealt with in Bangladesh. Infrastructure, which is basically Link Net and EDOTCO. I think I talked about the carve-out, which is implemented well. EDOTCO performance has been extremely good this year with the revenue growth and EBITDA growth strong and profit coming at $210 million in the first three months, first three quarters. We're also seeing colos developing well in EDOTCO.
So fundamental operational performance across all operating companies has been strong. I think Adlan will talk about a little more details around that. And I think we have still opportunities in Link Net to improve its performance as well as EDOTCO to further improve its position in all the markets. ADA, our digital businesses. ADA actually is a fairly strong top line and EBITDA business. I mean, its revenue has grown by 18.8% and has, I mean, we looked at the valuation where we had the new investor coming in, investing $58 million this year, which basically translated around $550 million value of ADA. I think Boost has launched the bank, which has been doing extremely well. I think Sheyantha will talk a little bit about how the bank has been performing.
ADL, I think other than internal business, which is basically serving our OpCos, also has been doing well in terms of trying to get new business from external vendors here. So I think opportunities, all of them have got very strong position where ADA on data transformation and AI will drive opportunities across geographic expansion. I think Boost, by moving from just pure payments to a lending business and building a portfolio across that, would generate significant cash flows and profitability in the future. And we expect ADL to deliver external business. So I think in terms of what our priorities going forward is going to be, we look at it as in two boxes. One is what are the long-term strategic assets we have.
When I say long-term strategic assets, these are assets which we are going to be run from an operational performance, yield delivery, managed balance sheet well, and cash flows here, and that's really the telco businesses of ours. Four businesses, three plus ADL, which is quite close to the telco business, are going to be the core where we control and the two where we have a joint venture, CelcomDigi and XL-Smartfren . These five assets would be primarily focused around yield play. Now, why we think this can be achieved? A, we are seeing market repair as one of the fundamental developments in these markets. Yes, there's always a pause, which is a reality because the moment you start gaining a market, then you start seeing either the regulator or one of the competitors start bringing that down, but I think long-term, it is sustainable.
Second is consolidation. All our markets are actually now three-player markets. And in each of the markets, I mean, if I look at five markets, three of them, we are number one operator. One market, we are a very strong number two operator, and one market, we are very close to the number two. So that puts us in a not just a market structure, but also puts us in a market position where we have scale to really build and also generate strong cash flows. And that primarily should result in strong yield play for us. The other bucket is these four businesses. Two of them are the infra business and two are digital businesses, which is primarily focused around value illumination. When I say medium term, the objective is to hear from them. How do you drive their value up? What are the actions being taken?
The four CEOs who are actually running these businesses will cover that in subsequent space. I'll not spend too much time on that. I think effectively, as you create value, Axiata will look at monetization as well as getting investors who would be right ones for these businesses to be taken to future. I think that's broadly what our focus would be, breaking our assets into these two categories here. I think from Axiata as a corporate center, I think clearly as a group, what will we focus on? I think we will focus on value creation from portfolio. How do we drive value from each of the portfolio assets? How do we decide on the right kind of capital allocation across and what are the strategic plans we have across not just the existing portfolio?
Also, as we bring down our exposure on the balance sheet, where do we reinvest our money going forward to continue with growth? And the rest of the stuff is more around what is required for us to be a mandatory listed company as well. How do you ensure shareholder protection? But one important element where we will be focusing, and I'll cover a little bit in detail in the later part of the day, is really how do we provide the right kind of oversight and monitoring of our assets, specifically as we move more towards two of our large assets where we do not have direct control, where we are controlling with another shareholder or a partner of ours. Just a quick one on ESG. I think you would have seen the videos on what Asri was talking about, what we are doing on ESG.
We're looking at ESG on four planes. One is advancing digital societies, green economy, which is really around the environment, advancing our people and communities, and governance and risk. Each of those elements, we have very well-defined targets on what we want to achieve. For example, on digital societies, we've said by 2025, we should have 20 to 23 million people impacted in the areas of healthcare, education, and financial services. I think we are progressing well. We've already touched 19 million there. We should be able to meet the 23 million target. Green economy, I think we were one of the first telcos in Malaysia and just the four PLCs, which actually got validated by SBTi on our baseline target of 2022. So with using baseline target of 2022, our objective is to reduce by 42% by 2030 and to net zero by 2050.
So I think the company is putting plans in place on all three scopes, one, two, three on what we need to do. Third one is people and communities. It's really around how do you bring digital inclusion in the markets where we operate. Some of those markets are still quite backward. How do we make those markets more digital? And I think as for the World Benchmarking Alliance, we are ranked 22 out of the 200. I think they're benchmarking 200 different operating groups, and we ranked 22nd. So the effect which we've been able to bring in on digital inclusion as well as focus around diversity, which is one of our targets. And last one, but not the least, is really around governance. And one of the key targets where we are positioning ourselves is around the cybersecurity, our capability on data protection and cybersecurity.
How do we rank ourselves under the NIST framework, maturity framework? So we are looking ourselves to be around the top 30% companies when it comes to in ASEAN, when it comes to the NIST maturity benchmark. So at the end of it, let me just look at what we are going to cover today. So one is clearly what we'll, in my next presentation, talk about what is Asia Connectivity Leader, what are we trying to achieve, value illumination and path to monetization. I think the four CEOs will cover, which I talked about. CelcomDigi, I think it's still an important part of our portfolio. So we'll have Datuk Idham talking about how he's delivering on synergy coming out of the merger.
Axiata.AI, I think Thomas will talk about what are we trying to achieve, what are our North Star on Axiata.AI, and what are our prioritized internal and external use cases which we want to do. Nik will cover capital management, how we are deciding to allocate capital across different portfolio of assets. And I'll touch a little bit in the end around how we're going to be governing our operating company, more specifically focused around the companies where we are not the controlling shareholder. Just a quick roundup on where we are on some of the, these were the five key takeaways which we got from the analysts and the investors when we did the presentation in the last investor day. One was, what do you want to achieve out of market repair?
I think good news is we've seen that from 2022 onwards, at least 10% growth in ARPU, something which was not very visible in our industry for a very long time, but we've seen that positive effect. We've seen our balance sheet, which was again a concern. Can you achieve that 2.5x which you're talking about by 2026 net debt to EBITDA? I think we are on the path. Yes, some benefits of the currency we've got to get to 2.59, but we are in the path. And I think Nik will cover in more detail holding company cost because that's clearly a leakage when it comes to cash flows coming from our operating company. So we've been able to bring down the holding cost. And I think, which we touched upon a little bit on our U.S. dollar exposure in frontier market.
As I said, net net, we are actually cash positive if I put all the three companies and our U.S. dollar exposure in it. And last one was the Link Net. How are you going to deal with this whole delaying? I think we've completed that. We've recently announced a teaser to the investor, and the teaser actually talks about divest spin-off Link Net because we think our focus in Indonesia should be more around the mobile merged company, which is XL Smartfren. So with that, I'll just end my presentation on our Strategy 5x5 . What have we done? What have we achieved? And what are our goals or priorities going forward in 2025? Okay, let me just touch upon the Asia connectivity leader. When I touch upon Asia connectivity, the way we've structured it is the two blocks which I talked about.
One was what are we doing with our digital telco, which is essentially the connectivity. And we want to be a connectivity leader in the footprint markets where we are present. So I'll touch upon how we've been delivering that, how we're performing around that, and what's the goal for us going into 2025. The second one is really around the value illumination and monetization of those four assets, which the four CEOs will cover subsequently. So I'll just cover the first part as in my deck. So let me see what is it that we want to achieve with the five telcos which we have in our footprint. I think North Star is clearly we want return on invested capital greater than cost of capital. So that's what we want to achieve as the objective.
Now, how do we get that by four strategic thrust area, three strategic thrust area? One is profitable growth. Second is structural transformation of the assets. And third one is the optimum capital structure each of those assets should have. And how do we get the profitable growth? Primarily through market repair, which I think we've talked about, ARPU enhancement. I mean, I think market repair is more market structural issue. I think the key element what we want to achieve in these markets is ARPU uplift. Now, that could be through market becoming much better or could also be by bundling certain other services along with the connectivity services to get the ARPU uplift. Operational excellence really around focus around cost. How do we keep optimizing the cost, specifically our delivery cost in terms of network cost and the operating cost per GB? That's the focus around cost.
The element on structural transformation is really around delayering, which is what we've done, and can we bring our infra assets outside which can serve one-to-many versus being just inside the company serving their own ServeCo and make ServeCo asset-light? I think a good example is how we did that with EDOTCO in the past. Now that we've done that with Link Net, and I think going forward, potentially on enterprise side, I think we were looking at that also as one of the opportunities, the software where we have ADL as a separate entity which can serve multiple operating companies versus being inside a company where it's just one-to-one relationship. So I think that's really the focus around the structure, and then second side is the ServeCo side.
How do we ensure that we have the convergence and go-to-market with an asset light model available? And the last part is really around the capital structure. How do we ensure our profits and cash flows are protected and our exposures on USD, specifically in frontier market, as well as proactive debt management? So that's the key areas of focus for us to deliver on directionally return on invested capital greater than cost of capital. Let me quickly cover all of them. I think we've seen strong development happening on the revenue side, ARPU buildup. Yes, Robi's been a bit of a challenge in the last five months, partly coming out of the fact the new country, the new economic situation there, and also some taxes which have been introduced recently have had a negative impact on ARPU. But in our view, that's a temporary phase.
I think the operators are aligned on ensuring that the market is more sustainable. Dialog, we've seen a strong development in ARPU. I think that's good news. Smart continues to pick up on ARPU. I think that's clearly reflective of how ARPU development drives growth in EBITDA. Revenue, I think I'll not spend much time. I think we've seen strong growth there. EBITDA development across markets has been strong. I think Dialog has been partly impacted because of the high cost of electricity as well as the effect of some of the currency movements, and Smart has seen a very strong performance of EBITDA, and I think one of the key measures which we say, when I say capital productivity for our operating companies, we look at CapEx to EBITDA as one of the key measures.
I think hitherto everybody's looked at the productivity as percentage of revenue, but revenue is always a mix of multiple things. And they could be low margin revenue, they could be high margin revenue. And the moment you put CapEx to revenue, you are not really reflective of how the CapEx is driving the contribution to EBITDA. So what we've done is our measure is CapEx as a percentage of EBITDA, which we track. So we've seen across operating company, our capital productivity improving. And that's largely coming out of both improvement in EBITDA, which you can see on this line, and managing the CapEx in a much better way than we've done in the past.
This is just a metric just to give you some perspective across various other companies in this region, how we are when it comes to Axiata's EBITDA performance, EBITDA growth. You look at EBIT growth or you look at PATAMI growth. PATAMI growth, I think, could be because of the currency aspect and it's now very comparable with the others too. But I think the operational performance in terms of growth in EBITDA as well as the EBIT growth, which we've seen in Axiata, is actually holding very well compared to some of the other operating companies or groups in the region. Optimal capital structure, I think, is reflective of what does this mean from a profitability standpoint. I think we've seen a strong development on profits in Robi as well as XL.
I think Robi, if you look at the numbers, has pretty much multiplied 3x over the last two years, which has been a very strong performance. It's coming out of the performance on EBITDA as well as managing the capital productivity well. XL has seen the same effect in terms of developing. Dialog being challenged because of the interest rates as well as the electricity cost, but I think we've seen some good signs developing now. Smart continues to deliver very strong performance. I mean, if you look at between 2021- 2024, Smart is probably ending up with around $50 million of additional profit being generated. Having said that, I think the cash flows again remain very, very strong across these OpCos, mainly coming again through very well-managed capital productivity. The balance sheet looks much stronger coming down in XL as well as Robi.
And also now we are seeing that effect in Dialog. I think these are all fairly balanced sheets which can be well managed. Structural transformation, I think XL, Link Net, where we made XL as a ServeCo, which has now 1 million fixed broadband subscribers. Around 750 million subscribers got transferred in September from Link Net to XL. So it's one of the, I think, second largest when it comes to in Indonesia as a fixed broadband provider serving 1 million subscribers. And there are plans for building around 6 million home passes. 3.5 million, 3.5 or 4 million is already there. Another 2 million has to come over time. So that would provide access to them of around 6 million home passes. And they could provide the right value proposition. In fact, 80% of their new home connects are coming with the converged proposition, right, Feiruz?
So that's, I think, the proposition which we've been driving in Indonesia. Link Net, they already have 4 million home passes. I think the expectation is to continue growing. I think the plans are to get down to around 8.5 million home passes over the next three to four years. So I think that shift of what we call delaying of Link Net becoming a FiberCo and XL becoming a ServeCo has been put in place here. I think Axonect, this is another example of what we are trying to do on structural transformation where we've in Bangladesh, we've moved our enterprise business as a separate entity, really focused around ICT business on top of the connectivity solutions which they're providing to their customers. So that's something which has been, which we intend slowly implementing in other companies.
Again, it's part of taking it out, keeping it highly focused on that particular objective. So what do we expect new things coming up in 2025 other than continuing with those focus areas which I talked about? I think is how do we improve our gross add engine in all the markets? So one of the key measures we are looking at all the OpCos to manage is net add to gross add ratio, which I think should be specifically in markets where there is this what we call is a washing machine mechanism. How do you ensure that your retention of those customers who you acquire is much better, not because of high cost incurred, but because of the customer experience we provide? So that's something which is going to be one of the key measures.
In addition to that, I think on the converged play, we are looking at how do we use in markets where 5G is going to come expected in 2025, FWA as a proposition, specifically markets where the fixed broadband remains under penetrated. How do we build business on Open Gateway and also commercialization of our cyber security capabilities which we have in two locations, Sri Lanka as well as Malaysia? The last one is really how do we drive synergies from the new merger between XL and Smartfren. I think we expect completion to be done by April. I think good news, we've already decided on the management team, which we announced last week. I'm happy to have Rajeev, who's the CEO of Robi, step in to be the CEO of new MergeC o.
And then also we've already triggered off plans on integration to be built so that on day zero or day one, we are in full steam to deliver these synergies here. I think these are some of the things which we are going to be focusing on. Sri Lanka as well as Cambodia is expected to have 5G in 2025. So I think we would focus on driving FWA specifically to realize untapped demand for FTTH because the market is still not fully fiberized. Then open gateway APIs. This is really around how do we use the open gateway. Sri Lanka is doing it with the API federation of all Sri Lankan operators. We've commercially launched under ADL, which is called Axonect, is the open gateway platform which can open access to the APIs to the developers. So that's an area where we're going to focus on.
The last bit is our capabilities competence, which we built under the Cyber Fusion Centre. How can we take it to the market? I think there's a lot of interest we are seeing in Malaysia itself, which I think is something which we're going to be driving in 2025. So that's it, pretty much what I wanted to cover on Asia connectivity as well as the broadly on what we are doing on our S trategy 5x5 here. Clare, back to you. Thank you.
Good afternoon, everyone. Post-lunch session. You know I have the difficult job. Vivek always says, "Do you have to show what ADA is?" So I brought some help along with some numbers first. He said, "Show the financials, get them excited." So our financials are $210 million, gross revenue $18 million, EBITDA $80 million of cash in hand, so a lot of dry powder. But what does the business do? You have this big line. We transform business using data and technology. So I have a bit of show of hands. How many of you have bought something on Lazada or Shopee recently? Shopee or Lazada? Shopee or Shopee? Anyone's bought something on TikTok? On ly Anu. And Feiruz. What did you buy on TikTok? No, sorry, I shouldn't ask. Anybody has chatted with a WhatsApp conversational AI chatbot in business? You have. Okay. Anybody has been targeted with an advertisement that you thought was, "This was deeply personal," almost like they know you more than probably your other half knows you better? Everyone, right? So that's what we do. We are the guys sitting in the background doing all of this, the data layer, the AI layer, the digital operations layer. And that's how the business is.
The business is 1,500 people across 12 countries and doing this day in, day out for 1,500 clients across the region. It just so happens the number of clients seems to be the same as the number of people in the organization. That's just coincidental, by the way. Our shareholders are, of course, Axiata, and very fortunate to have SoftBank, Sumitomo, and Mitsui as well, alongside who came along the way in the last six years. So the business of ADA is, I would say, one of the largest in the region. We are one of the largest when we compare ourselves to our peer group, doing a lot of conversational AI, e-commerce enablement, digital marketing with data and AI. So I brought some more help along to kind of explain what our business is, and I will play that now.
Magic happens when data meets powerful AI. Data is transformed into action. Intelligent commerce delivers outcomes when AI agents impact every touchpoint. Magic happens when we transform your business. We are ADA. 1,500 data scientists, engineers, consultants, e-commerce specialists, digital marketing gurus, creative geniuses, customer engagement experts. We're the biggest integrated e-commerce, WhatsApp, CDP, data, and AI partner in the region. We work in 12 countries in Asia, delivering on the promise of data and AI, delivering powerful marketing and commerce outcomes. We are ADA.
Exciting? I hope so, right? So as a business, if I break it down, it's broken into four main services: data and AI, marketing, digital commerce, and customer engagement. And for those of you who want to get even more excited, there are a lot of favorable marketing market drivers that kind of drive this, right? A lot of investment from enterprises in data and AI platforms.
So you would have heard about Snowflake, Databricks, Treasure Data, etc., as kind of enterprises are adopting these. So they come to us to help them kind of build these data lakes. A lot of targeted marketing, so personalization at scale. So we do a lot of work in creative and performance marketing to enable our clients across. E-commerce, of course. E-commerce acceleration, e-commerce penetration. So we help clients, again, integrate that data with the marketing, with e-commerce to drive real transactions for our clients. And finally, post-transaction, a lot of seamless interactions with consumers between enterprises and consumers on channels like WhatsApp, SMS, of course. And this is where a lot of synergies with the telcos comes in, online, on Viber, on KakaoTalk, etc.
So we drive a lot of this kind of essentially the marketing and commerce engine for our clients across. And again, to kind of repeat, all of this is underpinned by a lot of market tailwinds, a lot of market drivers which are kind of favorable to us. But something that we also do across the whole domain is how do we deeply integrate a lot of data and AI and the technology into driving a lot of these digital operations? So we have been doing this, of course, quite manually with a lot of our data analytics and data engineers. In the last 24 months, we built a presence in India with about 400 data analytics and data engineers just serving all of Southeast Asia as a market. But we started to productize a lot of our AI modules.
We started to productize, for example, in the e-commerce space, how do you do price optimization? How do you do promotion management? How do you do demand forecasting better? How do you drive better supply chain and inventory management? So as we started to productize, we started to build what we call our kind of AI Copilot suite that we launched actually officially in 2024. And this is essentially a Copilot for enterprises, for digital service operators inside enterprises. So there's a Copilot for e-commerce management. There's a Copilot for full funnel marketing. There's a Copilot for conversational AI. There's a Copilot based on all the customer data segments and how to utilize value out of it. So these Copilots are just like we all know Microsoft Copilot that helps you with office productivity.
These are Copilots that kind of help you with productivity and better decision-making and prescription engines as you kind of operate any of these kind of marketing and e-commerce functions. So I brought one simple video along just to show you what does an e-commerce Copilot kind of look like when in the hands of a brand or an enterprise user. So Vivek mentioned one of the jobs, of course, is how do we create more value in the business? How do we, of course, extract value from it over time? So the way we are, what is our blueprint here on, right? I said $210 million gross revenue, $18 million EBITDA. We have a lot of dry powder, $80 million of cash in hand. We don't have any debt. We're going to deploy that further growth and investment.
There are two main areas that we think investment will go in for us. One is how do we establish a data and AI moat in every client? And the second one is how do we take what we have built in Southeast Asia into global markets? Interesting fact, on Friday, we changed our domain name. We were ada-asia.com. We became adaglobal.com. Of course, we can't be operating in the U.S. with an ADA Asia domain name, right? So that's something that we did on Friday. We are actively pursuing entering into the U.S. market in the next quarter. We've already started operating in the MENA market last quarter. So how do we expect kind of our kind of financial profile to grow? Because I think that's what is most important. I have two axes, EBITDA and gross profit.
So our gross profit is, of course, net of cost of sales. So currently in 2024, based on current annualized run rate, $18 million of EBITDA, $93 million of gross profit. So there are three main prongs of our growth from here on. One is organic, of course. We have successfully organically grown the business in the last six years. So we'll continue to do that. A lot of organic growth is going to come from our proprietary IP and AI Copilots, more geographic mix of developed markets, and a lot more integrated solutions for our clients. That takes us from $18 million-$29 million of EBITDA. The next phase, of course, and this is, by the way, parallel as opposed to phases, is tuck-in M&A. We mentioned about the cash in hand.
We're going to deploy that to kind of acquire more capabilities in this domain, a lot of AI and data capabilities, and grow that EBITDA even further while also expanding onto kind of top-line growth on gross profit, and then as we enter markets like the U.S., how do we go even more aggressive on our global expansion domain? And really, essentially what we are thinking about is how do we take what we've built and double the EBITDA and double the bottom line? ADA has been profitable since 2019. ADA was formed in 2018, but has been profitable since 2019. There is a lot of, also, out of many of these years, it's also been positive cash flow generation business.
The idea is to continue to, of course, generate profits, but also reinvest for further growth, but always make sure that we are doing a balanced growth between top line as well as bottom line. My final slide, and Vivek had mentioned this in his presentation, the most recent valuation of ADA at the current financials is $550 million from a Mitsui transaction. Just prior to that, a couple of years ago, it was SoftBank at $260 million, and in 2018, it was Sumitomo at $110 million. So there's a clear trajectory of growth. We continue to expect that, bring strategic investors along the way, and rely on the promise of a billion dollars of profitable unicorn, or as we call it, Proficorn. And this is how we expect kind of the value to build. Organic, like I mentioned earlier, $160 million of additional value coming from that.
Tuck-in M&A, $180 million from that, and we have today $80 million of firepower to kind of invest to building that over the next few years. Finally, of course, global expansion. As we think about U.S. markets, MENA markets, as I mentioned, and this is how we expect in the next few years to get to a billion-dollar valuation in terms of where we are, but again, just to remind you, it is a profitable growth for us. It is not based on just top-line growth. That's all. Thank you very much. With that, let me invite Sheyantha, the CEO of Boost, to kind of present his story.
G ood afternoon, everybody. So I've been doing this back-to-back with Srinivas for the last three to four years, and he spends a lot of time trying to demystify his business, hopefully, given that this is largely a Malaysia-based audience. Most of you know what Boost is and what we do. But let me start with the same question I think I asked last time or maybe the time before. How many of you have a Boost account? How many of you? Oh, not bad. My hit rate is improving, I think, Vivek, year on year. How many of you have a Boost Bank account? Not so great. So for those of you who don't have a bank account, we've got a counter over there. I've got my team guys at the back. A lot of work to be done. A lot of bank accounts to open here.
Okay, so let me start with the topic I get asked about most of the time for the last six months or so, right? About how's the bank doing? What do I think about digital banking? How are the new banks that came into work performing and so forth, right? But before I get to that, I think just taking a step back, going down memory lane, Vivek spoke about the focus for the digital businesses is very much value illumination. And I think in order to illuminate value, you need to have a cohesive business model. So one of the reasons we actually got into banking was not because it was something that was in vogue two years ago when digital banking was the talk of the town in fintech, not because banking licenses have a scarcity value.
All of that may be true, but we did it really to complete our business model. If you think about our journey, we started off in a very narrow space, which was really the payment space and e-wallet space as an e-money issuer, and back in 2017, 2018, and our entry into that space really gave us a couple of things. It was never an end in itself, but it was more a means to an end, but what it did give us is it gave us a platform to understand how a regulated fintech or a regulated business under a central bank works. It gave us a platform to build partnerships. It gave us a platform to build a large customer base, and it gave us a platform or an understanding to learn how the economics of this business is important as you scale.
One of the things we did right along the way, probably two years into the journey, was we shifted our model to become one of a lender, so not just a standalone payment issuer, where the business economics are very difficult to scale or be profitable in the long term. If you look at markets across the region, that's the case, and even if you look at Malaysia, if you look at fintechs or companies in our industry that have stayed as a pure e-money issuer, you would find that the returns or the ability to get into the black is very, very difficult, so our journey to get into lending business, where we built our credentials as a lender, really set the way for the journey we have today.
We have about five years of experience, almost six years of experience, where we've dispersed close to about MYR 5 billion worth of loans, both in Malaysia and Indonesia. That gave us essentially the founding building blocks to get into banking. Now, why did we get into banking? The fundamental reason was because we felt that if you wanted to build a scalable business, you really needed to have your funding equation solved. In Malaysia, if you wanted low-cost funding and if you wanted to tap markets, we felt they were not deep enough. They may be deep enough to do a $400 million loan book, but you will not be able to do a $4 billion loan book, which is probably the scale you need to operate at. That's kind of where the opportunity also is, especially in the underserved sector.
That really was the reason why we went into banking. I think if you take the journey of Boost, I think from a business model, from a licensing, and from our ability to provide financial services end -to -end, I think we have the full plethora of licenses and products now available under our portfolio. How has the bank done? I mean, we launched a bank middle of last year. It was graced by the Prime Minister of Malaysia, and we were very honored to have him there. In the first six months, I think we've crossed our first hurdle. We've been able to mobilize deposits more than we anticipated and more than we actually needed. At the end of the year, in December, it was close to about MYR 700 million worth of deposits. Our initial target was to do about MYR 350 million.
We did that by utilizing probably 70% of the capital that we had allocated on this journey, over 200,000 customers already, and we continue to add more and more. One of the things that was unique to us is we decided to take what I call an embedded experience, where we had a lot of customers already on our e-wallet app transacting, but basically using just e-wallet services. We were able to convert a lot of those customers into banking customers by giving a very seamless experience where you can just continue to do your banking services on the same app. You don't necessarily need to go into another app. That's a model that actually can be replicated where it just doesn't have to be within Boost or what we do at Boost. It could technically be ported into any other app.
It's a blueprint that we were able to get past the regulator. I think it's something that I think you will see more and more us doing more and more as our bank evolves and as we grow our partnerships. I think the deposit journey is interesting for me also because I remember in 2020 when we started, and there were a couple of us shortlisted for the bank license. One of the biggest challenges we had, or one of the biggest questions the regulator would challenge the shortlisted participants were, was on our ability to raise deposits. They knew some of us had credentials as a lender. Some of us had done a lot of that.
But could a bank with no branches, given that there were a lot of banks in Malaysia, deposit penetration is close to 100% just because you offer a higher rate than somebody else? Would somebody actually place deposits with you? Now, I think not just Boost, but I think all the digital banks that have launched to date have been able to prove that or get past that hurdle. Obviously, there's a lot more to go in terms of proving our overall model, but I think that's an important hurdle, which I think the regulator also realizes and something that we are quite happy about having achieved that in the first six months of operation. So what is our, I mean, this is a simplified version of the Boost portfolio, but if you think really about our portfolio, we have a bunch of different businesses, obviously accumulated over time.
But if you really classify the value drivers, as we think of getting to unicorn status, it's really centered around the consumer lending, the micro SME lending, and then obviously the deposit side of the equation to fund that. And that's really going to be the core focus of what we do, not just in Malaysia, but probably in other markets as well. A lot of what we built really forms an enablement layer around that. So the closed-loop payment system, which is really our e-wallet, still remains a very important catchment tool or a catchment ecosystem for customers who come and adopt banking services. Our open-loop payment system, which is our payment gateway service, which we launched last year and is catching on quite aggressively, is something that both is an enablement layer, but it is also a strong layer of monetization.
And then we have investment products as well that kind of complete the picture. So that's kind of how I would bucket the Boost portfolio going forward. And a lot of our investment, a lot of our focus will really be on the value drivers as we look to drive value towards creating the value illumination story for Boost. So what have we done? I mean, if you think about our journey, we are not new to actually raising capital or working with partners or getting people to back us with capital in our story. If you take our journey, and this is not just investors into our cap table, but these are commercial partnerships also that we've done over the years. We've had very large names in there that have essentially backed our story with writing fairly substantial checks.
We are about to. I can't really talk about too much, but we're about to announce another partnership valued at around $45 million, probably in quarter one this year, pending regulatory approval. I can't say too much more about that or even say too much more in the Q&A. Once that is completed, we would have raised close to $200 million+ across the entire Boost story from inception. That, I think, is the first important step in value illumination to be able to get other investors, other partners to co-invest with you in your story so that there is validation both in terms of what you are doing, but it also puts onus on you to deliver a return to those you brought along the way.
A lot of what we do with partners, and the model of Boost has always been, if you like, a B2B2X model. So it's not just about the capital, but it's about using a lot of the partnerships that we have, whether it's an investor, whether it's a commercial partner, to help extend our model and build an ecosystem around it. So a lot of what we've done with embedded banking, which I just mentioned, will be extended with a lot of partners that we have out there in the market. We've done a lot on the merchant micro SME space. So merchant lending, micro SME lending has been the anchor of our lending business for the last five years. But having a full bank license now, we have the ability to do a lot more along the journey of helping small merchants to digitize.
That's something that we are going to launch in quarter two this year. Banking as a service, just to explain the concept very quickly, it's basically being able to offer your banking rails on a white-label basis to somebody else. So if you think about a third-party app, I'll take our sister company as an example, CelcomDigi. If they want to offer banking services, they could, in theory, use the license that we have and offer a telco bank on their app using the licenses that we have in Boost. Similarly, in markets where we do not have a banking license, we could become a consumer of those services. And it's a very powerful tool to help us extend our model. So in Indonesia, we've actually partnered a bank called Bank Nobu to extend the model that we have in that market.
We're also looking to extend large ecosystems, working obviously with the Axiata family. We haven't done a lot over the last eight years with the Axiata family, but over the last two years, I think with CelcomDigi, some of the initiatives we're doing with XL, and we're just trying to pilot something with Smart as well. We are looking to extend a lot of the expertise that we've built outside with third-party partners, looking to see how we can extend that within the Axiata family. So my final slide, I mean, how does all this add up to thinking about value and value illumination I think? Broadly speaking, I mean, without giving too much guidance, I think our last internal valuations value Boost close to around between $300 million-$350 million. So I think we really want to think about how we build that up to the unicorn $1 billion status.
And aside from the value drivers I spoke about, which are obviously going to be key areas of investment from a product perspective, I think there are three levers that we are really looking at. One is a path to profitability. If you take a non-bank business, I think on an EBITDA run rate, we are just burning under MYR 1 million now a month, which was something like MYR 10 million-MYR 15 million if I go back two years. And so in a couple of months, I think that should be a break-even. If you look at our digital bank, we have a timeline of about two and a half years to break-even. We are ahead of that business plan as of the end of this year.
Given that that business is not a complete greenfield, it's a brownfield, taking a lot of components of what we have today and building into it, I see no reason why that should be at risk. That is the minimum. That is the minimum we need to achieve to build the value. The second thing is obviously the primary driver of that value will be lending, because in our business, lending is where the money is, and that's where the margins are. That's fortunately where we have built a track record. It's really about extending that model, given that we have the funding side of the equation solved, which was the constraint for the last couple of years. It's about how do you really scale that lending model.
And then, of course, replicating what we have done largely in Malaysia and to some extent in Indonesia across regional opportunities. If you think about the problem we are solving, which is essentially solving the financing gap for underserved segments, that's not a problem that is unique to Malaysia or Indonesia alone. And we have the benefit, of course, of having Axiata present in a lot of these markets with customers. And that gives us a very nice anchor footprint to market entry rather than going cold. So those are some of the key pillars, aside from the investment in the value drivers that I spoke about, as we think about a journey to becoming a unicorn. So with that, I think that's the end of my presentation. I think there's Q&A later, and with that, I'll hand it over to Kanishka to talk about Link Net. All right.
Good afternoon, everyone. This is the same slide in a way that I showed in the last Analyst Day, where when we were starting the delayering exercise of Link Net. So the main difference compared to what we discussed in December 2023 is that we have executed the delayering exercise in Link Net, where we were looking at the business from four different business units, what we called as the ServeCo, MediaCo, FiberCo, and EnterpriseCo. The ServeCo is the residential B2C business, which has been carved out and transferred to XL. This transaction was completed at the end of September after obtaining the approvals from the regulators, and currently, the way we operate in Link Net is that it's three individual business units, which have been internally separated, which have their independent P&L with a dedicated management, and we have defined the individual customer segments, these three business units, which we'll be focusing.
Then the profit and loss statement for these three BUs are transparent in a way because there are transfer pricing established between the three individual BUs that we have. So what was shown in the last Analyst Day in 2023, we have executed that delayering journey with the carve-out of the ServeCo to XL in September. Let me recap some of the key milestones that we have achieved in 2024 from two sides. One is transforming the Link Net business towards a FiberCo. And the second is how we supported XL , how XL has become our main anchor tenant in the FiberCo. So the first one is in June. By June, we completed the new rollout of another 600,000 FTTH home passes, where we have bypassed about 4 million home passes in total in Indonesia, the second largest fiber footprint in the country.
As I explained before, in September, the customer transfer to XL was completed. Two other key elements to highlight with the customer transfer is that once the customer gets transferred from a FiberCo point of view, we have a master services agreement with XL, where it covers already 750,000 active home connects covered in this master services agreement, and it will continue to grow when XL keeps on growing their FMC proposition. Similarly, we have entered into a content reseller agreement through the MediaCo of Link Net, where XL is a reseller which resells Link Net's pay TV and the other OTT and content that we have. By November. Through the growth of parts of the growth of the FiberCo is that we have secured commitment of another 600,000 home passes to be deployed from operators other than XL.
And then in November, we signed this MoU with another operator called Surge to open up our existing footprint for them to be operating in an open access model. And in December, so earlier, the commitment from XL was 1 million home passes. In December, this commitment was extended from 1 million- 3 million home passes, which to be deployed over the period of next two to three years. So that's a recap of some of the key achievements that happened in 2024. It's a bit of a busy slide, so let me just pick the key components that need to be highlighted. So currently, as I said, it's three highly complementary business segments, the way that we operate.
So, we call it FiberCo, which is the FTTH wholesale business, NetCo, which is focusing the enterprise B2B, and MediaCo is again the wholesale media pay TV content OTT aggregation business. So the main things to highlight from FiberCo is that currently, we are, after Telkom, the second largest wholesale FTTH network, 4 million home passes deployed, and already we have another 3 million home passes in the pipeline. So we are looking at 7 million home passes in total with what is deployed and what is committed, which has long-term commitments and some contracts come with minimum guarantees, and the contracts are in the range of 10 plus 10 years plus five basis. And then already we have MoUs with some of the operators to open up the network for them to come in in open access basis.
Similarly, EnterpriseCo currently, the primary focus is on connectivity, but we are focusing towards more of ICT solutions going forward. It has some of the largest enterprises in Indonesia in our network already. There's about 2,600 customers in total in the enterprise business, and the average tenor is about 5.5 years. Similarly, MediaCo currently, there's about 500,000 pay TV subscribers. Again, with XL, it's a 5+ 5 contract, and we have some of the most wanted content in Indonesia. For example, HBO, it's only two operators who have access to HBO in Indonesia at this point in time. And with the transformation, we have accelerated the transformation of the FiberCo, and we call this model as FiberFactory model, where we went from being an integrated Telco to a FiberCo, so we looked at two main angles.
One is in terms of network rollout, building up the capacity, and the other part is the cost improvements. So from a network rollout point of view, compared to what we used to deploy in the past, the monthly average home passes rollout has increased significantly in 2024. Compared to what we did on a monthly average basis in 2023, we have done twice in 2024. And currently, we have built capacity that it can be four times compared to what we deployed in 2023 from a monthly average point of view, the home pass rollout. And the cost improvements, some things to highlight, cost per home pass, we have managed to bring it down by 15%. Installation cost, what we call as the cost of a home connect, has come down 30%.
Then the maintenance cost per home pass, we have managed to bring it down 40% in 2024 compared to what we were doing in 2022. Then the FiberCo, from the value creation and the business growth point of view, we are looking into two pillars. One is the existing footprint, which is the 4 million home passes that we have deployed already, and the other is the 3 million commitment that we have already secured. The growth in the existing portfolio, the 4 million comes from increasing the penetration in the existing network, which will come via going through the open access methodology, getting the other operators to come in and increase the penetration in that network. Plus, the other angle that we are looking at is providing the infrastructure for our own enterprise business, plus the other enterprise businesses in the country.
And then the other angle is what I explained before, is the cost management, is looking at the cost per home pass, home connect, and maintenance, which we have done quite a bit of work already. Then future growth, currently, three million home passes are committed. The target is to reach 8.5 million home passes by the end of 2027. And as Vivek highlighted in the opening presentation, we are already looking into new funding coming in to fund this future growth, the commitments that we have secured already. And then from a FiberCo point of view, these are the key three areas that we are looking at in terms of growth and value creation. The first one is that we have a very strong anchor tenant in terms of XL, which has the three million commitment with us.
Similarly, we will be looking into other partners in terms of the ISPs or MNOs, where we will be deploying the network on a build-to-suit basis. Normally, the build-to-suit all contracts are long-term contracts on a 10+ 5 basis with a minimum guarantee and a shorter exclusivity period, and then the other is that the open access network, whatever the home passes that go out from exclusivity will be opened up to any potential operators who are coming in. That is the second angle, and the third one is that in Indonesia, there is this concept of townships where real estate developers have access to, let's say, 100,000 homes, 200,000 homes, so the other angle that we have started working is that getting into strategic partnerships with these developers where we become the infrastructure provider for these real estate developers.
So these are strategic partnerships that we are looking at where we can provide end-to-end infrastructure for these providers, including bandwidth. Yeah, let me touch upon a little bit about what do we do in the enterprise and MediaCo in the next two slides. So from the enterprise business point of view, currently, 65% of our revenue comes from connectivity. And currently, what we have been doing now is that to shift that from going more towards solutions, mainly in terms of ICT solutions. So the connectivity revenue to come down over a period of time to 50%, and we have a balanced portfolio between connectivity and ICT solutions.
From the customers, as you can see, we cover most of the top customers in the country, starting from the Defense Ministry, all the three armed forces, the banks, BCA, Mandiri, five-star hotels, some of the telecom operators, and even players like Grab and GoTo in terms of connectivity. This is my last slide. From MediaCo point of view, we have gone through a major transformation. Earlier, it was B2C. Being from a B2C operator, we have gone to become a B2B operator, where we are becoming more of a content aggregator for both pay TV and OTT. For example, we launched HBO Max in November, where we aggregate the content, and then XL is our main reseller for HBO Max in the market.
So we have gone through this transformation of going from B2C to B2B, and we have laid the foundation where we have obtained the rights from the operators to be selling on a wholesale or aggregated basis. Similar, for the traditional pay TV, we have managed to get the OTT rights from these operators as well. And then currently, for the focus is the residential side. It's mainly via the resellers in the market, like XL or any other MNO or any other ISP. And the other area that we are focusing is the hospitality, going into the hotels, hospitals, likewise through our enterprise business, where once again, it's sold in a wholesale basis. With that, that's all. From Link Net point of view, Clare, I saved you six minutes. Yeah, let me welcome Adlan, who is the CEO of EDOTCO.
Good morning. This should be green, actually. The color coding should be good. Anyway, good afternoon, everyone. Happy to see all of you again this year. I know that I'm standing here between breaks, right? So I hope that I can still get your attention. Yeah, I hope there's some good, interesting story that I can tell you, yeah, what's coming up for 2025. Yeah, so maybe, sorry, okay. Maybe as a start, I mean, I thought that just to get, I mean, we are talking to Annelise here. Maybe it's good to just show numbers just to get a little bit of your attention, right? I mean, so I think just a little bit of EDOTCO story from 2013. I think we have gone through four phases of our journey, and we are currently at EDOTCO 4.0, right? From a carve-out from Axiata, we expanded our portfolio from 2015 onwards towards South Asia, frontier market.
I think in 2000, from 2020, right, during COVID time, I think we pivoted our portfolio, right, more towards Southeast Asia. I think today, in 2024, if we look at our portfolio today, we are looking a lot in terms of value creation and potentially monetization. Essentially, if you look at over the last 10 years, 11 years or so, we have actually grown our portfolio, right. Our own and managed towers today is at 56 million, 56,000, sorry. Well, 56 million is even more than China Tower, yeah. So 56 million owned and managed, a CAGR growth of around 13%, right, over the 11 years period. Essentially, we have actually grown our colo ratio as well to about 1.66.
If you look at it over the last three years or so, we have been focusing a lot more in terms of growing our colo ratio. These all have been translated into financial growth, yeah, revenue over the years on an annualized quarter three numbers. We are at around $575 million, CAGR growth around 13%. I think EBITDA at around $402 million, CAGR growth of around 18 million, 18%, yeah. Part of our shifting portfolio as well over the years, I think we have shifted a lot more now towards more Southeast Asia. In 2015, for example, 48% of our revenue comes from the emerging market in Southeast Asia. However, today, 62% of our revenue actually comes from emerging market in Southeast Asia, right?
So there's a shift moving towards Southeast Asia given some of the new acquisitions that we have done, Philippines, Indonesia, and some strategic acquisitions that we did in Malaysia. Quickly, I think over the last three years or so, I think you have seen that we have carried out a few initiatives to really drive in terms of value creation, yeah, for the group. Essentially, the key one, as I said, is portfolio optimization, rebalancing and rebalancing, yeah, shifting a lot more towards Southeast, from Southeast Asia to Southeast Asia. And I think predominantly you see over the last three, four years, three years, we have done four acquisitions strategically in Indonesia, Philippines, and as well as two acquisitions in Malaysia. And that's a strategic acquisition for us because we are essentially entering into a Restricted State, yeah, a state that we cannot build.
And with that two acquisitions today, we do have presence and we are able to grow in that state. And essentially, the second key strategy as well, I think partly as well as part of this, there was some concern in terms of the merger. You know, there's some overhang in terms of how we're managing this merger between Celcom and Digi in the Malaysian market. I mean, good news is I think we've come to a landing with a win-win situation in terms of that merger resolution. We'll talk a little bit about that in the subsequent slide. We have also focused a lot in terms of yield, right? How do we enhance yield? How do we drive our yield forward, right?
Essentially, if you look at where we are today, the good news is by third quarter 2023, all our countries, all our NTCs are actually PAT positive, except for Philippines, given that I think we have just done the acquisition. We completed the acquisition of Philippines in 2023, right? So, and if you can recall in 2021, yeah, in some of our frontier market, even at EBITDA level, we were losing money, right? And today, I can, I'm glad to announce that, you know, in all our NTCs, including the frontier market, we are all PAT positive, right? I think the other aspect of it, we have actually been focusing in the last three years in terms of growing our colocation.
Over the last three years or so, we have grown our colo by about 0.24x , right, to about 1.66, not by chance, but essentially in terms of driving through proactive marketing rather than sitting back waiting for our customers to give us order, but also to drive and working together with our customers to drive our colo up, and in some of the markets as well, we have actually focused a lot in terms of our dynamic pricing, in terms of how when there are economic conditions, changes or factors changing in certain countries, I think we have worked together with our customers to see on how do we work on pricing also, which to a certain extent, this has helped in terms of transforming in terms of our performance in that NTC.
Last but not least, but equally important as well, I mean, we have actually continuously driving towards operational excellence, right? Using technology, automation, as well as now, I think a lot of focus in terms of driving through AI initiative, right? Be driven to make operations a lot more efficient, yeah, whether in the energy space, right, whether in the operation space, and also in terms of how we manage our field operation as we stand today, yeah? Okay, let me talk a little bit about our portfolio, right? Over the last three years, you have seen that we have pivoted our portfolio a little bit more towards Southeast Asia, and I think if you look at our portfolio, we are categorizing it into three main buckets, essentially the growth market and the core market, essentially Malaysia, Bangladesh, Cambodia, as well as in the frontier market, so to speak, right?
These are assets that we have turned around and probably are ready for monetization. Today, I think if you look at our strategy today, it's about balancing growth and yield, right, in terms of our two-focus portfolio in the growth as well as the core market. If you look at the core market itself, if you look at our portfolio, these are markets where we are market leaders, clearly market leaders, where we are really leading the industry and really trying to shape the connectivity and the policies and such of the country working together with governments really to drive in terms of future connectivity. If you look at all these markets, I think we are growing much faster than the market, right? And I think in these markets as well, these are operations that is a cash cow to the group.
Essentially, we are actually working in terms of continuously to enhance yield as well as maximize dividend coming from this country. Just if you look at all these countries today, Malaysia essentially declaring dividend today, I mean, it can go up to 300 million MYR of dividend. Essentially in Bangladesh, we have the capacity depending on our CapEx level to declare dividend even up to 5 billion BDT, right? Cambodia is a nice country for us given we are seeing a lot of growth in Cambodia. It's a US dollar market as well in Cambodia. I think while Cambodia is still growing, but I think we would expect some median dividend coming from Cambodia in 2026. The good news is I think this year we EDOTCO Group will be declaring our first dividend, right? Or hopefully, right? Yeah.
I think that's what our shareholders have been looking, waiting for the last 10 years. Hopefully, we can declare some small dividend this year, right? Philippines continues to be our growth market, yeah? If you look at, we understand that probably Philippines, the level of competition in Philippines, the number of players have increased significantly over the last two, three years, right? I think, and you would see that there has been a slowdown in Philippines for the last two years or so, right? However, I think the good news is I think demand is coming back in Philippines. I think we believe the end story on Philippines, we are still bullish and we believe that the growth in Philippines is still there, right? Over the last, we expect that the end result in terms of the industry achieving 60,000 towers is still on the card, yeah?
That has not changed. Maybe in terms of timing, there's a slight delay given the situation that we saw in the last two years or so, but the demand is still strong in Philippines. One of the key aspects that the focus in Philippines is about in-country consolidation, right? In terms of tower companies, right? You have seen that this already started, and I think it will intensify over 2025 also. And I think this in-country consolidation is a key element in terms of balancing between the supply and demand in the country. And Philippines, it is a growth country. Today, we are still not EBITDA positive, but I think within the next two, three years, I think we should be able to transform this operation given the projection or demand that we're seeing in the market, yeah?
So if you look at all the other frontier markets, I think these are operations that we have turned around and ready for monetization. They are self-sustaining, no support from the group, and essentially I think these are all profitable operations per se. Okay, in terms of over the last two, three years, I think we have been really focusing in terms of driving these value realization, right? Across the group, we are well aware of some of these risk factors and something that we've been working on over the last two to three years, right? The pivot between frontier and emerging, right? We are pivoting a lot on the emerging market. I think essentially you've seen, right? With the acquisition in Philippines and Indonesia, it's trying to achieve that, right?
Essentially in some of the frontier markets, like we are also looking at potentially, you know, potential if there are selected frontier markets, really looking at how do we continue to drive in terms of self-sustaining and probably selective expansion policy to see how we also drive yield enhancement in some of these markets. And all these markets today, if you look at it, I mean, they are of a sizable business, right? Really self-sustaining, profitable, and ready to be monetized per se. On CelcomDigi, I think this is one of the overhangs, something last year. However, this year in 2023-2024, there's a little bit of overhang, but today we've come to a resolution in terms of coming up with a win-win with CelcomDigi. I know Datuk Idham will be speaking here today, yeah? So, and I think he probably can talk a little bit about this.
I mean, it's a topic that we have discussed in the recent tower exchange as well. But I think overall, I think it was a win-win for both, yeah? The customers as well as for EDOTCO as a partner. One of the, we have also entered into to exit Myanmar given the sanction risk. I think it's pending closure, pending regulatory approval, and we hope to close this transaction sometime this year, yeah? On the business part as well, I think we are really focused in terms of driving in terms of our balance sheet management, in terms of improving liquidity, and really focusing in terms of high yielding revenue, yeah? Namely focusing on colo. Colo, I think if you look at the last three years or so, essentially the group is doing a lot more colo than a build-to-suit, yeah?
This is part of our yield enhancement exercise that we have actually done, right? At the same time, I think really focusing on our effort to really continuously drive operational efficiencies. Last but not least, on the financial aspect as well, I think we have been working on cash flow, right? Matching between our debt as well as revenue, right? In local currencies. And essentially as well in terms of managing our balance sheet. If you look at our debt to EBITDA as well today, I mean, it's come down to about 3.84x from a high of 4.7 in Q3 last year, right? So I think this is something that we'll continue to manage and part of our risk mitigation strategy in terms of the value enhancement for the group. Malaysia is still our biggest contributor, right? Albeit from a revenue perspective, yeah?
Today, Malaysia contributes about 43%, yeah, of our, if the group revenue, right? And essentially from a value perspective, yeah, Malaysia contributes more than 50% of the total group value, yeah? And Malaysia continues to be a key market for us. And I think we are continuously driving, looking not only to sustain the operation in Malaysia, but also to look at potential growth, yeah, coming from Malaysia as well, right? So I think where are the growth coming potentially is from 5G. I think you know from DNB, we do have about 2,000 towers with DNB today, right? That's approximately close to about 30% of the total DNB tenancies. And I think the other part as well is on the second 5G network.
Of course, there's still a lot of uncertainty on this, how it's going to take off, when it's going to take off, in what shape or form. I mean, we know that the winner has been announced and all that, but I think that potentially could be an upside for us, right, in terms of driving the 5G business. I think the second interesting aspect as well today, if you look at Malaysia, we can only play in seven states, yeah? The other seven states are potentially Red States, yeah? That we can maintain our existing towers, but we cannot build new towers, right? And essentially moving forward, if you look at the demand coming from or the rollout requirement coming from the Red State, it's close to about 40%.
So for us, penetrating this Red State is also a key important strategy to opening up, to open up new market for us, yeah? So, and that's something that we are really working on in terms of whether we do it, we work together with our partners and see how we can do that, right? The other part as well in terms of aspect that growth that we're seeing in Malaysia today is also on the IBS, yeah? We are one of the biggest IBS owners in Malaysia. We do operate close to about 470. Last year alone, in 2024, we did complete around 75 new sites for IBS in 2024. And that's a big number if you talk about IBS if compared against the past, right? And you will see that demand in IBS is continuously rising as well.
In 2025, we have actually gotten orders from MNOs as well in terms of driving this forward, yeah? The good news on IBS, typically I think you see that the colo ratio is high, right? It's over two times as well, right? So all in all, I think if you look at the CelcomDigi merger, of course, I think when we talk about this merger, we need to see what's a win-win situation, yeah? Understanding what the customer needs in terms of what they require is an important aspect because at the end of the day, the formula is how do we work together, and essentially one of the key aspects of this for CelcomDigi is the flexibility in terms of relocating the towers to realize some of the synergies, yeah, that they've planned for as part of the merger.
For us, it's not about the LD, like liquidated damages when people move towers. Essentially I think going into this partnership, this merger discussion is all about win-win situation. We have managed to come out with a resolution that we think benefits both sides, right? For us, it's some short-term impact, but in return for a longer-term value creation, yeah? Some of this what we actually saw was I think we managed to extend in terms of our retained sites, sites that we retain, another seven years contract extension. I think in return for waiving some of the LDs as well, I think for there are swap sites that we have agreed with Celcom with a 12-year tenure, right? On a net-net basis, I think it was a win-win for both.
I think the key for this is we currently have a model how we can replicate as we move forward. Of course, the next we probably see a merger in Indonesia with XL and Smartfren. However, I think our exposure in Indonesia is relatively small given our position in Indonesia is also not big at this juncture. Just some key takeaways. I think performance over the last three years, I think we have seen that revenue, I think growing by about 15% over three years and 22% on CAGR. You see that the group tenancy ratio increased to 1.66. Malaysia is at the highest at around 2.34 now, yeah, given our focus. As part of our portfolio as well, I mean, we are focusing a lot in terms of driving in our core markets, enhancing yield and maximizing dividend and delivering growth in terms of our new market, right?
Some of our non-core assets, I think we are probably, they are probably ready for monetization. I think the other part as well, we've been working in terms of this value realization at the group. I think we will proactively continuously work on this in 2025 and forward. Malaysia remains our key contributor, key market for us, very important market. I think it still contributes the biggest value to the group and focus really in terms of leveraging our leadership in 5G, extensive portfolio coverage as well as our cornerstone grid, yeah, to really drive enhancing yield and also potentially growth in Malaysia. I think last but not least, there are a lot of new areas of growth in business. I mean, potentially given that operators are also, MNOs are also delaying that potentially you can tap on as next phase of a tower company. And hence I think some of these new business requirements potentially would probably require additional funding. But that potentially could come from probably debt or potential equity, right? So that's all I have. And looking forward to the Q&A session at the end. Thank you.
Good afternoon. Assalamualaikum. Thank you, Clare. How's everyone? The person on stage looks like me. Sounds like me. May smile like me. It is me. If you shoot me, I'll be hurt. Unlike the video that you have seen. But these days, you know, the era of AI and so on and so forth, you have no choice but to make that qualification. I think this is going to be one of the biggest challenges that we're going to have in the industry. And we, of course, I can talk about it a little bit.
What are we doing about this in terms of protecting our customers and making sure that our customers are not falling into the kind of scams, etc.? This is something that is very, very close to our heart, yeah? So as what Clare has mentioned, I will spend maybe about 15-20 minutes just sharing in terms of where we are when it comes to the merger. I may not go to so much detail that you guys would expect, yeah, because we have only about 20 minutes today. Further details can be provided to you. Of course, when we have our own analyst briefing, which we hope to do in the second quarter, then we can deep dive a little bit more, yeah, than what I'm going to share today.
So today is only about progress, where we are, what we have done well, some areas that we are working on. Is that okay? All right? Let's talk about this. When we merged, I think day one was December 1st, 2022, and two years have passed. I tell you, if you talk about time flies, and in such a digital time really, really flies. But one thing for sure now is that we are truly, we have been, and we are truly and have been a one company, yeah, one company in terms of brand, one company in terms of the people, the management team. The people and the management team is one area that we really, really focused when we merged. The top management, the top 12 people that are going to run the company was identified before day one, including the top 100 management team.
The top 300 management was identified within the first 100 days of the company, so we put a lot of focus on that, so when we first merged, we put ourselves—what you see on screen—it's the same slide that I presented. I think I believe in the early 2023, about what are the priorities for us, and we put this into five pillars, and I'll talk to you today about each one of these pillars. The first pillar is about accelerating the integration, making sure whatever synergies, cost savings that we promise is something that we can deliver. That was the priority number one, and that has been how we rah-rah or we bring up the whole company about delivering the synergy, delivering the integration, making sure that goes smoothly. The second pillar is about winning in the core.
Our core here, we're talking about the mobile consumer business, is continuing to lead the market. You know, after the merger, we had about 20 million subscribers, 20 plus million subscribers. What we need to make sure was that we continue to have 20 plus million subscribers and continue to be a market leader. We have seen most of the telcos globally, when they merge, typically within 1%-2% market share in terms of losses. We put ourselves, it's like, let's try and not to lose any market share within a certain period of time. Winning in the core to extend the market leadership. The third pillar is about building a new core. Besides the consumer mobile, then what else are we building in terms of our revenue base? There are two main areas that we want to focus on in this one.
Number one is home and fiber business. Home and fiber, which then also becoming our conversions business when we deal with our 20 million customers, is number one. We knew that we were slightly behind our competition on the home and fiber, but this is, we think it's a long-term, it's an area that we must play in. The other pillar is enterprise. Enterprise today is roughly between 11%-12% of our business. It's not big, between 11%-12%. We hope to take it up to the high teens or up to 20% within the next few years. It's not big, but it is still about MYR 1.1 billion-MYR 1.2 billion business in the beginning. Now we are getting close. Our target is to get to at least about MYR 2 billion business in the next few years.
The fourth pillar then is about shaping our future assets. What do we do with the assets that we have? There are things that we don't play today. One, of course, the most obvious one is we still have some towers, whereas EDOTCO, yeah, we still have some towers left inside our company. What do we do with it? I think that's one potential valuation. We still have about 20+ data centers around the country. What do we do with it? We have 20 million customers on our side, on our system that we understand, collecting the data, the analytics, etc. What do we do with it? So those are the assets that we have and then how do we build the future of this asset? How do we create value from this asset? And the fifth pillar is the one that enables it all. It's about the people.
How do we build a new culture, a new set of teams and succeed with this, we call it succeed with the talents that we have? The five pillars, that's what we promised. This is what we said that we're going to do. That was at the beginning of 2023 when we come with my first analyst briefing for CelcomDigi. Then I'm going to spend now about 10 minutes about where are we in each of these pillars. Let's look at the first one. Two years into the merger, we would say that our technology integration is slightly ahead of plan. First biggest integration is we had post-merger about 24 million. Sorry, that's too many, yeah? Like not 24 million towers. So we have 24,000 sites, both Celcom and Digi, we merged and we're going to build a new single network of about 18,000 sites.
We planned initially by the end of this year. It should have been about 70. Now we are about 75% completed in terms of the modernization and integration. That is ahead of time. That means three quarters of our customers now are being served with a brand new network. By right, by right, they should have a brand new experience on this network. We are seeing actually a better throughput. We're seeing more throughput through the network, more usage per subscribers, and more in terms of improving signal quality. We have also changed the network domain name. Now there's no longer a Digi. There's no longer any Wilayah Celcom. It's now just one network name. It's called the CelcomDigi, MY CelcomDigi. That's the first big milestone that we had. Second one, the technology is the systems.
We have 50+ systems to be integrated. Last year was, Anthony would know, last year was the busiest IT integration that we have. We have 39 different IT system integrations happening at the same time. This includes four big systems, which is the ERP, the billing system, the CRM, and the dealer management system. There's four big ones. We completed 20 last year on track, 19 progressing because it's not supposed to be completed. Overall, we think we are on track. All this integration and modernization, we will save expected to avoid about MYR 1.2 billion CapEx to be avoided. You just imagine both Celcom and Digi before the merger had, as an example, billing systems. Both billing systems need to be upgraded because they're going to become out of service within the next couple of years.
So instead of two spending on the new billing systems, we spend only on one new billing system. Instead of two different ERP systems, because we use an old ERP, Digi used the Oracle and then in the process of being upgraded, but we now have one ERP, the latest ERP list. Similar on CRM, similar on other smaller systems as well. So instead of spending on two, we're spending on one. So expected MYR 1.2 billion in terms of CapEx avoidance. The second big one is retail. I wonder any of you who actually has been to our new retail shop. It's a totally transformation of, it's no longer the old Blue Cube. It's no longer the old CelcomDigi, sorry, the old Digi store. It's a brand new CelcomDigi retail outlet. And we are looking at bringing a different type of services.
But one of the most important things that we observed is that the productivity from the new retail outlet, we're looking at 1.2x of the two outlets in the same area before. Okay? So that's what we're seeing. And we have completed 48 new retail outlets. We targeted about 40 at the end of last year. We completed about 48. And now we are moving towards completing the franchise network outlet. So at the end of this process, we will continue to have the widest in terms of retail outlet coverage, the number of shops. We will be still the largest in terms of technology, fast-moving consumer goods outlets in the country. Much bigger than the Apple shop, bigger than Senheng, bigger than any of those retail outlets that sell phones, that sell devices.
We will be the largest in the country, continue to be the largest in the country. So that's the second part of the transformation. The third big one was the people. When we merged, we had about 4,700 people working for us. Now we do have about 3,500. We have gone through a few exercises. One of it is a voluntary separation scheme. That actually saves a lot, but it's not only saves a lot, but it helped us to refresh the organization. About 3,500 people now running the whole operation, which is almost the size of slightly larger than Celcom when we first, before the merger. So we're running the organization now in a lot more efficient way as well. So this is the three big ones in terms of what are the things that happen in terms of merger.
Of course, there are other things that we do, the smaller things, but the three biggest ones are one is technology integration, retail integration, and people integration, and this involves, for example, the sales team integration, the dealer integration, the trade integration. All those also have been integrated into one year, so the operation, all that moving, so at the end of the day, we expect to save, because the question will be, how much do we save? How does this impact the P&L, so we're looking at this at the current rate. At the end of the day, we will save about between MYR 800 million or slightly more than MYR 800 million in terms of taking out the cost from our OpEx. If we were before the merger, by the end, we do reach a steady state at the end of the integration process.
We will save about MYR 800 million coming out from the OpEx. This is just OpEx, yeah? MYR 1.2 billion in terms of CapEx, so on and so forth, and of course, there are other areas, there are smaller areas that we also avoid the cost of spending twice. Just a little bit more breakdown on where this is coming from, of course. I think the biggest one, as expected, in terms of savings coming from the network. So the network, I mentioned about MYR 1.2 billion in terms of CapEx savings. We have saved so far until the third quarter of last year, close to a billion already, but more importantly, in terms of the P&L, the network operation expected savings, about MYR 150 million, MYR 140 million from IT, OpEx, and people integration as well that has saved us other costs. Okay? All in all, it's about MYR 800 million savings.
To get there, we will spend close to MYR 1 billion, but most likely more than MYR 900 million in terms of integration costs, things that we spend to get the savings, right? This last year, 2024, it's expected to be the largest, the highest cost in terms of integration costs, and now it's getting lower and lower for the next few years, so that's where we are, and we are now. I'm pleased to share actually that we are on track when it comes to this and when it comes to achieving the synergy or the cost savings that we promised at the beginning of the year, so let me touch a bit about winning in the core, and I'm going to give you a little bit about the explanation of what's happening in the market. Number one is we are the market leader.
We still, our subscriber base has not gone down. It's gone down a little bit, but we are still about 20.2 million subscribers in Malaysia. Okay? So we still have that kind of, so that part has been very stable. We did have a challenge in terms of dual SIM consolidation. We had a bit of a challenge there in the beginning because some of our customers, they do have a Celcom SIM and they also have a Digi SIM, and post-merger, they have to choose. Well, some of them choose one, which one they will choose. Most of them choose one and continue to stay with us, and we have passed that stage. So we are still about 20 million subscribers. Postpaid, we grew more than 300, close to 400,000 new subscribers coming into our network on postpaid. So we're seeing growth, very good growth on the postpaid.
We have actually put the whole product under one brand. Now everything is called CelcomDigi. There's no longer Celcom Postpaid, there's no longer Digi Postpaid. Now it's CelcomDigi. So we grew on the postpaid. A very good growth. We're seeing a very good traction of pre to post migration as well on our network, especially after the network upgrade. Prepaid is where we had a bit of a challenge because of the SIM consolidation. There are two parts to the prepaid. One is the SIM consolidation because there are two. They choose one. They remain with us, but they choose one SIM to keep one SIM. The second one is, of course, something in an area that we decided not to play or not to be too dependent upon, which is the one-time SIM or the calling card phenomena, if you call it in Indonesia and other markets.
So one-time SIM market. We decided to say that I think we need to focus a lot more on the long-term profitability of the company as opposed to have some of a few of the short-term gain. We focus on that. We don't focus so much on the one-time SIM market. We focus on growing our Postpaid, focus on growing the good, the natural prepaid market. Brand, I think I mentioned we refreshed the brand, more than 50 new products and campaigns were introduced, which yielded the result. We focus a lot more on customer experience. Now, not many companies in Malaysia actually have about 20 million subscribers. Not many companies in Malaysia. Possibly, I don't know, maybe Grab has that kind of users. But CelcomDigi has 20 million subscribers and 7 million-8 million use our app almost on a daily basis.
So we have this opportunity on elevating the customer experience and get them to buy more from us. And of course, the last but not least, the new retail and digital experience that we're going to provide for our customers. Some of this, you say, watch this space with the new app that's coming along very soon. On the new core, home and fiber, very, very encouraging growth. We're seeing close to 20% growth in terms of home and fiber in the first three quarters of last year, highest since the merger. I would call it outpacing the competition. We were behind, but we are catching up in the market on home and fiber. ICT solutions is another big area that we're looking at. We have five main pillars that we're going to focus on about cloudification, about cybersecurity. We invested in two companies in cybersecurity and cloudification.
One is Bridgenet Solutions. The other one is Infront Consulting. Bridgenet Solutions today, as a cybersecurity company, probably one of the largest cybersecurity companies with close to MYR 150 million in terms of annual revenue. So it's something that we are growing and nurturing them. And the synergy between CelcomDigi customers and their services is very encouraging. And we have more than 100 projects that actually we're working on with various customers. Innovation is another area that we promised to build. We promised to invest about MYR 250 million into the innovation center. We launched our AI Experience Center for those that have not been there to our AiX. Okay, actually can register either with us or through with Farah. We have probably close to 2,000 visitors just in the second half of 2024.
And we have not only local visitors, we also have international visitors that come and visit our AiX. It's something that we think has a lot of potential because we have over 40 different AI and 5G solutions inside the experience center, which I would love. I would welcome everyone here to come and visit us. Perhaps when we do our investor day, that will take you through our AiX. So that's on that. Touch a bit about AI. There are a few things that we are focusing on when it comes to AI and also Gen AI. We have a few models, but there are three areas that we focus on anyway. Number one, how do we use AI to serve our customers better? I think that's our thesis number one.
Number two, how do we use AI so we can then sell our services better to our customers? And number three is how do you use AI to generate new revenue? So there are a few projects that are happening in the company. We have a few. One is Sophia. For example, Sophia now has automated more than 200 different processes. Almost every report in the company and the reports that we provide to our regulator, to MCMC, is generated by AI. In the old days, who has access to it, just send an email to Sophia and ask a question, and Sophia will come back and answer with numbers or whatever. Now we have everybody have more direct access to Sophia that is linked to our app. Tia, for example, is our intelligence that's within our technology team.
Most of the, you know, I mentioned we have 50+ systems that are being integrated, and each of these integrations has to go through a process. One of it is user testing. Tia, our technology intelligence agents, will design that user testing for you, for us. We did a lot of automation, something that will take weeks now can be done in days. That's Tia. Ray, R-A-Y is Ray, is for our enterprise customers. They can help to build the customer profiles before you submit a proposal, before you can do, before you go see a customer. Ray will generate that profile for you, for our customers. We have a program that's called AIDA, which is AI and Data Accelerator for everyone throughout the company to make sure that everybody is. Yeah, AIDA is, it's right after AIDA.
Yeah, so AIDA is called AI and Data Accelerator. And then 30% of our staff actually has gone through this program. So this is something that we put a lot of attention to. There are a few things in the future that are playing on the AI infrastructure. That's something we have not gone to the market yet. How do we do? I mentioned we have 20+ data centers that we can convert into something that could be meaningful on how to use in the future of edge computing, edge network, and so on and so forth. One promise that we have in the future is our ability to attract partnership, partners, technology partners from the future. So this was a chart that we have.
And if you see the logos on the screen, those are the partnerships that we struck just in the last first two years of the merger, from the international or global tech companies to the local companies, so on and so forth. So the thesis of that, by having a merger and a company that's large enough with 20 million subscribers, will attract partners that will not otherwise have large enough partners in the country to come and work with us. So this is what the outcome of that. And these partners all work within our AiX Innovation Center. A little bit about the people. Yes, I mentioned 4,007 down to about 3,005 in terms of building this. We're building a new culture. What's important that I always tell the team that CelcomDigi is not the enlarged Celcom. It's not a larger Digi.
CelcomDigi is a brand new company. CelcomDigi is a brand new company that's building a brand new culture, our own culture. And we call it the progressive winning culture. And we are building this, a culture that's actually engaging, a culture that's engaging with customers. We have a program that we call Jelajah 5G, where I wanted every single management to go down to the remote part of the country in our vans and check on our coverage, talk to our customers. And some of these pictures we have is what we call it one of the cultures that we have is a customer, to be a customer focused, a customer centric. This is a Customer Day where 3,500 people go down to the ground and speak to every single customer that they see on the street. So we're building a new culture. It's a new company.
So far, good enough that we were kind of recognized a little bit by some of the partners, by LinkedIn and by a few others. We have won four, I believe about four awards last year about being an employee of choice. And we hope this is one area that we really, really are going to build. My last slide. We came to the market a little bit about what's our ESG strategy. Four pillars around the ESG strategy about building an inclusive and safe digital access. I spoke about this. We are quite dedicated about anti-scam. We work with PDRM. We work with MACC on how to go against the scammers. It's about building a sustainable value chain, about building a culture of governance. And last but not least, about the environment. We are committed, as you can see here, to the net zero.
We will get the benchmark, the base plan by the end of this year. That's our ESG. We want to play a big role on this so that we are to be perhaps one of the companies in the country, in Malaysia, that people look up to when it comes to ESG. Okay. Save the best for last. I'm sure most of you have a question around 5G and so on and so forth. Yeah. There are a few things I can cover, but not everything I can cover here today. I'm sure that you know all the decisions that have been made. There are so many things that are going to happen. I'm not sure whether there will be more surprises because the last decision was a surprise. It surprised the country. It surprised us also. We are not dwelling into those decisions.
The decision has been made, so we have to move on. But what's the most important for us today is that number one is our customers are enjoying the 5G services. They are able to access the 5G services. The decision does not change that, right? The fact that we didn't get the second license does not mean it impacts our customers. Our customers are enjoying the 5G services. I think that's point number one. And that's point, that's I think one of the most important points. Number two is we have activated all our customers to enable them on 5G. And we want to be a leader in 5G. So all that our customers have to do is just upgrade their phones into 5G and they are able to access the 5G, no need to buy anything. So that's the second part.
The third part is we are working on many 5G solutions for the enterprise market. We believe that the 5G for the consumer is one, but the 5G for the enterprise is not a big opportunity, and with the investment in AiX, with the focus on the enterprise solution, we have something that we can work on. Now, how do we do on the infrastructure? I think that's another big question that we do. Today, we are accessing it through DNB's infrastructure, which we are a shareholder of. Yeah. Now things are a little bit clearer now that we are now working on what is the best way to move forward when it comes to DNB, but those are perhaps subject for a different discussion at a different time when things are a lot more clearer in terms of what needs can be done.
With that, I hope it will give you a good, just update on where we are when it comes to post-merger. If there are three messages that we'd like to end with, number one is that we are delivering what was promised, the hypothesis around the merger that is taking shape. Number two, we are focusing on the long-term profitability of the company. We continue to win in the core. In some areas, we may not focus in the area that's not for the short term. We're not focusing for the short term, but for the long term, we will continue to win in the core business. Number three, there are new businesses that we are working on, and this will come and bring new innovation to the market and hopefully a much better experience for our customers. With that, thank you. Yeah, thank you so much. Thank you.
Datuk, you want to stay on stage so we can do the Q&A? If we have any questions, as I mentioned just now, we'll allocate maybe about 10, 15 minutes for this session as Datuk needs to take leave shortly after this. Are there any questions? Maybe if you put up your hand, we'll pass the mic over to you very quickly.
Hi, good afternoon. Thank you very much for this Investor Day and good afternoon to Datuk Idham. Datuk, I just want to ask you about the 5G, right? I know that you said that a lot of things are not finalized yet and you can't speak very much at this point in time. But given the fact that the second 5G license has been given to U Mobile, and in the past, U Mobile has been somewhat in a less advantageous position because of spectrum, right? Now that this second 5G license has been given to them, do you think that it could potentially change the competitive dynamics in the market? And if not, why not?
Thank you for that question. The market has been very competitive. The market itself has been competitive, right? I think that's an important criterion. It used to be a four-competitive market, but post-merger it becomes a three-competitive market. U Mobile took that opportunity to come up quite strongly. The fact that they got more spectrum for the 5G, yes, it has the potential for them to be even more, well, what they can offer to the customers. But it also depends on what they plan to do with it and how they plan to do with it and how they're going to roll out and use the spectrum. So far, I can't speak for them because we don't know.
What we hear also just from the market, they have not made known of their plan on what to do with the spectrum, how, how big the coverage, and so on and so forth. So it all depends on what they're going to do there. But what's important for us is we also have access to it in whatever the one that matters. We have access to the DNB, and we can reshape DNB based on what we can do with our own infrastructure. But we also have access to the second network should we find it something that is useful for us. So yes, they may be able to build the network with the spectrum, but with the current structure, it does not mean that they have a full or exclusive to that infrastructure. I hope that answers your question, yeah.
Okay, thank you. Are there any other questions?
Very good.
Hi, thank you, Datuk Idham, for the presentation. I just want to get your view on this consolidation thesis and synergy that you mentioned earlier, right? So ASEAN telco, generally, we've seen consolidation in other markets like Thailand and Indonesia, where we did see our ARPU improve quite significantly pre-merger versus post-merger. And so those markets basically benefited from higher revenue and also they cut costs, so net profit impact is quite high. Whereas for Malaysia, we're basically seeing it from the cost-saving perspectives. Do you think with the network modernization that you talked about earlier, where 75% of your subs have new network, we will see the impact to our ARPU in Malaysia, or do you think we need to see another consolidation to see those kinds of impacts so we move to a duopoly market? Yeah.
Very good. Thank you. Actually, that's a very good question. You're right. When we talk about the merger, we talk a lot more about the synergy and the cost savings, etc. We didn't focus more about what's the economies of scale or what the market, the ability that we can do with a bit expanded market presence that we do. Yes, actually, the answer is yes. There's a lot more that we can do with the larger market. I don't want to use the word dominance or anything, but it's larger, we have now a larger footprint in terms of our retail outlets. We have a larger footprint in terms of number of dealers. We have a larger footprint in terms of subscribers going to our app, so on and so forth. So we have those access to the market.
Everybody's hoping for what you might call it, the market repair, when things happen to their. But in some markets, the market repair doesn't happen just overnight. That you merge suddenly the price, what used to be MYR 0.12 becomes MYR 0.13 , and then the regulator will come after you for the same thing. So there has to be a little bit more in terms of the change, how the value is driven into the market. Our market has come to a point where maybe counting GB is no longer makes sense. The moment you start to look at, you have one terabyte a month, then what am I going to do? You have two terabytes now, but it doesn't make sense. You use only a few GB, right? So it doesn't make sense anymore. So the shift has to happen. Where is that value?
You are exactly right. Now that we are 75% of our market, if all our network is modernized, we can deliver a much better experience for our customers that can be driven to as a new source of value for the market. Those will be coming. We do expect something will come in that space, but nothing much that we can disclose publicly. Yeah.
Do we have any other questions? Okay.
Very good.
Okay, thank you very much.
Thank you. Thank you so much for your attention. Thank you.
Yes, absolutely. It is me. You have eventually seen some of the avatars in our disclosures, etc. That is just one very tiny bit of AI which we are doing. During the next 15 minutes, I will talk about what we are doing in a more wrapping-around fashion about AI. We believe, I believe that Axiata is an AI company, and during the next 15 minutes, I will make all possible efforts to convince you the same. You have heard from Srini, from Datuk Idham, you have heard from Adlan that we are doing AI in many aspects already, and the whole thing is orchestrated. Obviously, our OpCos are experimenting, they are building, but we have a program orchestrating the whole thing at Axiata Group.
Axiata.AI is an enterprise-wide, group-wide transformation program in order to transform us using AI in our business, generating revenues with it, and at the end of the day, creating value through AI. Obviously, everything starts with a vision. And you are well aware that our vision is transforming towards a Telco -TechCo. And we believe AI will be very incremental and fundamental in a way to achieve that goal. So transforming to an AI-powered Telco -TechCo in order to deliver sustainable returns, that is our vision. And we are advancing very well in that regard. So Axiata.AI is a program which we have institutionalized in 2024, in Q1 or early Q2 2024.
It is, as I said, a group-wide program sponsored by Vivek himself in a little bit of a top-down fashion because we have a few building blocks to work through which you would likely to leverage the Axiata group-wide synergies and the assets we have in order to do things very much together. Obviously, you're aware that we have three cores: the digital telcos, the infrastructure business, and the digital businesses. They have different use cases, different opportunities how to utilize AI. In all of them, AI is playing already a major role and will play in future an even bigger role. From a digital telco standpoint, the objective is to use AI to augment, obviously, our business, customer-wise, customer fronting, product sales, back-end.
And on top, a very major building block is utilizing AI to manage our assets in a more smart and efficient manner. The same applies for the infrastructure companies where obviously assets is the biggest component of their business. And the AI will help tremendously to make those assets contributing more efficiently to Axiata's business. The digital businesses, in return, they are doing AI primarily as a revenue product. You heard from Srini about the bots and the agents which ADA has developed that are per se AI products already. So we have a number of key features on the digital telco side. It's network intelligence, customer intelligence, and service intelligence which we are driving. While on the infrastructure side, energy as a key cost component for us and an ESG topic obviously as well, tower intelligence, and at the end of the day, overall digital assets intelligence.
On the fintech side, Boost, of course, it's AI-powered financial services. In order to engage with the customers, do the credit scoring, etc., we use AI and very advanced analytics. ADA working very much on the MarTech solution side, and ultimately, we have our AI and API products and solutions. As I mentioned, we institutionalized this as a group-wide program in 2024, but we haven't just started in 2024. We are not just rookies on AI. Actually, we have started quite early many years back, namely in 2021 when we talked about analytics, and yeah, of course, GenAI is a hype and it's a hot thing, but AI is not per se new and not per se new to Axiata, so we have actually in 2021 started to really work with AI use cases, classical AI use cases.
We have developed our API or our AI Factory, I'm sorry, and started to deploy in 2022 AI factories across our OpCos. Those were scaled, and these AI factories allow us to really drive use cases at scale at a rapid deployment cycle in a way. In 2022, 2023, we started to really invest into people because that's ultimately what is required to drive innovations and technology. So people and AI skill development has been started 2022. It's also part, obviously, of Axiata.AI in order to really enable the whole organization to drive AI experiments and build use cases. In 2023, we started, certainly with the emergence of ChatGPT, also to work on GenAI. As I said, in 2024, we launched our group-wide program called Axiata.AI.
Axiata.AI is focusing on building capabilities and foundations besides then obviously focusing on building use cases and do use cases which the OpCos, for example, digital OpCos have in common to build use cases together. The foundation layers are primary data and architecture, then people and governance and risk. And last but not least, courage to change in order to drive really the mindset of experimentation is at the end of the day an outcome we are embracing. So on the data and architecture piece, we have developed a standardized data and AI architecture blueprint which is being deployed across all the OpCos. We have on the people side an enterprise-wide for everybody of the whole workforce, basic AI trainings, customized AI trainings for senior leaders, and very gamified AI programs for all the employees.
Last but not least, AI, and we mentioned or Datuk Idham was speaking about one of the biggest problems being with AI. I mean, I'm real, but when it is online, it's very hard to distinguish between deepfakes and AI avatars and the reality. So we are very much in line with deploying ethical AI. And we have built our Data and AI Governance Policy Framework which is being adopted across the group. We are working very closely with GSMA on that. And in a way, believe that we need to work very much on trust continuously in dealing with millions of our customers. So those minimum-based guidelines have been built, endorsed by the board, and also now being ensured to adhere by all the OpCos. Certainly then when you have built all these foundations, the use cases are where the impact is coming.
So we are looking obviously at a full potpourri of opportunities and possibilities. We have listed out or in a way imagined our use case rather, where front-end and back-end operations can be augmented and driven by AI. We have identified across the group then a number of priority use cases, both in classical AI and GenAI, which we believe can make high impact. And that is what we plan to scale then also beyond 2025. Amongst our Value-Based Planning, which is a very advanced AI system which helps us to bring our CapEx in best of order, and which has been a fundamental tool to help the CapEx intensity which you have seen coming into order. We are talking about next best offer, next best action, churn prevention, upselling, cross-selling algorithms and use cases.
When it comes to GenAI, and I will show you a bit later a few short examples, marketing image generation. Typically, developing a product might not be the longest consuming time factor before launching, but it is creating the campaign around. We are using now AI, GenAI, to develop the images, the videos to go to market. Certainly, front office and back office operations benefit obviously through GenAI using pilots, chatbots, etc. So we have in 2024 scaled up the use case deployment tremendously, 50% increase in use cases using our AI Factory which is rolled out across all the OpCos. And we have 35 instances of GenAI use cases live in operation at the moment. We have an array of classical AI use cases, just a few listed out here, which as I said goes across all the OpCos, but with different focuses of digital telcos, digital businesses, and the infrastructure domain. We have started to develop, as I said, GenAI use cases at scale. Yes, customer engaging chatbots and agents are, for example, amongst them. Let me show you just a quick example of how we are using GenAI to generate image.
Let's see how we can create AI images for creatives. First, we use Prompt Genie to craft an effective prompt to apply for Midjourney. Now, let's take a look at how we can create AI models of brand ambassadors. This is how we create AI models of brand ambassadors using Artflow.
Okay, I wanted to show you actually one fancy TV commercial with dialogue created using GenAI, but somehow a slight gap here. We'll circulate this separately and you can enjoy it. In short, we are using GenAI to develop images and videos and campaigns in order to get in a way products very quickly to the market and to shorten the go-to-market period. We are using, let me skip this one. And yeah, let me skip the use cases. You will get a video link and you can watch it by yourself. One of the use cases which we drive in the OpCos is customer-facing problem resolution.
And those use cases when you have a chatbot acting and in a way customer is giving its problem and the chatbot is then meant to resolve it requires not just a GenAI model, a large language model, etc., but requires APIs to go into all the systems which we have deployed, the BSS system, CRM system, etc. Axiata is at the front of the API development curve. We have 70,000 API developers working with us. We have internalized APIs. We have 6,000 APIs opened up between the systems, externally facing, internally facing. And Axiata is recognized as one of the three telcos to run open digital architecture by TM Forum. And we are at the end of the day Diamond Certified for having deployed APIs at scale. And we believe this in a way is all coming together to enable a strong AI play.
It's not just about AI itself. It requires a very strong data foundation. Data sits at the core, at its heart. And then we have obviously the GenAI and classical AI use cases, and they are all augmented via APIs. And that is our vision for the future, which in 2025 we will further scale up across all the OpCos through the Axiata.AI program. That is pretty much the 15 minutes. I hope you believe that we are an AI company. I can attest to you that 2025 is quite a game changer for us because that is where then the AI use cases roll in at scale. Thank you.
Thanks, Thomas.
Hi everyone. Yeah, Nik Rizal. I'm the Group CFO for Axiata Group. I believe the last time they had the Axiata Investor Day, I was there as a slide right at the end, just a picture of me. So now you get the real person for the first time. Okay, it's always difficult to follow business presentations. You know, for a finance person, for a special CFO to follow a business presentation because it's never going to be that exciting really, right? So I don't have any fancy videos. In fact, the slides can look a little bit boring as well.
However, I think the topic that we wanted to share today with, and especially when I think about the target audience, the investors and also the analysts, I think it's very important that you have an appreciation of the work that happens, what I always call in the back office, that really supports the businesses and the OpCos when they execute their plans and their strategies going forward. Because and the topic that we use actually selected is actually capital management. Because if you think about it, you know, you can have all the businesses, you know, and all the OpCos singing and dancing, but if you don't have a robust capital management in place, then you really run the risk of not being able to adequately and to basically plan the usage of your resources optimally, and the use of resources and your capital is vast, right?
For a group as complex and as diverse as Axiata, it becomes even more important that us at Corporate Center look at it holistically to ensure that going forward you are able to deliver the value back to shareholders. So even back in the investor day of 2023, under operational excellence, Vivek and the Axiata team then had identified under operational excellence, besides operational excellence at the business operations part of what we do, you also need to have financials operational excellence, right? Or operational excellence in your financials. And here the four key areas are around capital allocation, cost excellence, the third is about HoldCo cost reduction, and again, balance sheet optimization.
Again, it's important because every quarter when we have our results announcement and we have the engagement with analysts and investors, you hear Vivek and then myself for last year been talking about the high-level numbers. But I think it's important that you also understand the processes, some of the processes and some of the things that we have to do in the back end to achieve what we need to achieve, right? So when we start talking about the numbers, be it the HoldCo cost reduction, you know, in terms of the capital productivity, etc., it's not by fluke. It's not something that we just churn and it comes out. There's a lot of work that needs to happen together with the businesses on the business side to achieve the numbers that we do achieve at the group level.
Underpinning the operational excellence is around the operating model that was reinvented in 2024. I won't belabor the point. I think Vivek went through it as well. You can see that on the left, you have the typical Axiata at the AGB level, how we are governed with our committees, etc. The Axiata Corporate Center team is right in the middle. And then on the right is where we, how we manage and govern our subsidiaries and also joint control activities. At the bottom, you will see a slew, like you have like eight bullets there, basically indicating one committee each, which actually forms essentially the cooperation and coordination for the entire group. Right. So in terms of capital management in the new operating model, as you can see, capital management is a necessity, right?
Because a robust capital management process is required to not only plan, but also monitor and control the financial resources of the group to ensure that the capital, again, you know, at the end of the day, what I always tell people is resources are basically finite, right? Nothing is infinite. It's finite. Everything is about a capital allocation issue. Anything that you find in business is around how do you best and how do you optimally allocate capital to ensure that you achieve not only your business objectives, but also, as what's stated here, maintain your liquidity and also ensuring the most important thing, maximizing the returns to shareholders, right? So this is governed by various boards and management committees, which I'll go through next, but you can see a quick snapshot is for capital allocation. We do have the Capital Allocation Framework 2.0.
This came out from the last investor day. Capital Allocation Framework 1.0 was all around OpCo capital allocation, whereas Capital Allocation Framework 2.0 starts incorporating it at the Corporate Center or at the group level. So holistically, collectively, when you have those two together, then you are governing the capital allocation for the whole group. This is essentially governed by the Axiata Board Investment Committee and supported by the Capital Allocation Council and also the MAC, which is the Mergers and Acquisition Committee. Number two around cost excellence. A step change in capital productivity, Vivek alluded to already earlier, there's improvement over the years and again, this is through stringent stage gating processes at the OpCo Board Investment Committee, the OBIC, something which was actually newly started in 2024 and that has seen some results, and there's a slide on that later.
HoldCo cost reduction following the new governance model. This is again the role of Axiata HoldCo , which has been redefined in the new operating model and whereby productivity enhanced with the digital platforms and AI tools, some of it which Thomas had alluded to earlier, just prior to this, and finally, number four is on balance sheet optimization, the financial guardrails and dividend upstream. Again, this again governs the dividend upstreaming that we go to our shareholders. Again, this is to enable the group to achieve the financial outcomes and also the promises that we've made to our shareholders in the way back from the previous investor day and also going forward. On capital allocation, I won't go through. This is the key corporate activities in 2023 and 2024, which we know already and I had gone through in previous session.
Again, just to elaborate, the governance for the capital allocation is mainly at the ABIC, which is the Axiata Board Investment Committee. Obviously, as I had alluded to earlier, it's supported by two main committees, the Capital Allocation Committee, which is chaired by myself, and also the Management, the M&A Committee. On cost excellence around productivity ratio, again, apologies, we took out the numbers due to sensitivity, but I noticed that in Vivek's slide just now, there were some numbers around CapEx productivity, which we essentially define as CapEx plus ROU additions divided by EBITDA.
I think what is important is to see that comparing the graphs or the numbers that we showed or the profile that we showed in the previous Analyst Day to the Analyst Day for this year, you can see that the dark blue line is actually below the gray line, which indicates that it's even better than what we had promised, with the exception of a couple of OpCos, namely Link Net and Dialog. But that's mainly because, yeah, the exceptions did not Link Net and Dialog, because Link Net underwent the transformation, and for Dialog is the merger with Airtel. But with the main one on the top left, when you look at XL Axiata as a group, capital productivity seems to be on an improving trajectory from the last time that we engaged everyone.
On governance, on cost excellence, as I mentioned before, at the OpCo level, in 2024, we set up the OBICs in most OpCos, actually in all the OpCos under digital telcos and also digital infrastructure. This empowers the OpCos where they work closely with the CTO Council, the Chief Technology Officer Council, and also the CIO Council. This has been the main key success factor in optimizing our CapEx spend and also cash flow. Number three is around HoldCo cost reduction. As I mentioned, due to the evolution of the HoldCo role, which was strengthened to govern subsidiaries and joint control, mainly CelcomDigi and eventually XL Smartfren once the proposed merger is completed, we have seen a step change in the HoldCo cost, step reduction in the HoldCo cost.
Looking at the averages from FY21 to 23, even in 2024, the forecast for the full year last year is going to be approximately about 17% reduction with a further reduction of about 2% from FY21-23 level to 19% reduction, which is what we are inputting into the business plan to be approved by the board. Number four, and this is something that we get asked very often or something that we cover quite extensively in our quarterly results announcement. This is around our balance sheet optimization or strengthening of our balance sheet. In 2024, I think if we start from the left, right, you can see that from 2022-2023 to quarter three of 2024, at the Axiata Group level, we've reduced debt from about MYR 25.4 billion- MYR 22.2 billion.
At the HoldCo level in itself, it has come down from MYR 13 billion- MYR 8.4 billion as at quarter three. Some of the key initiatives that happened in 2024 is that in overall, we've reduced debt in 2024 from liability management. Here, we utilize or we basically took the opportunity whereby our long-term dated bonds, the 30-year dated bonds of 2050 EMTN, was trading at a considerable discount to its issue price, right? So it was basically at the 73.5% valuation or roughly about 26.5% discount, which meant that we were successful in redeeming or repurchasing some of these bonds from the market. So in quarter three, what we did as a group is that we purchased approximately about $272 million worth of these 2050 dated EMTN bonds for $200 million, which resulted in essentially a saving, right?
Essentially we used only $200 million of our cash to purchase or to retire $272 million worth of debt. So that has resulted in a gain, which we will record in 2024, but also means that over time that we've also reduced or saved on the interest cost or the coupon cost over the lifetime of the paper. Additional to the EMTN, there was also further debt repayments of about $150 million at the whole Group level, which is why if you look at the middle column, you can be able to see that US debt alone has moved quite significantly from $3.18 billion at the end of 2023 to about $2.8 billion as at quarter three 2024.
Again, besides the reduction of USD and HoldCo debt at the HoldCo level, we were also able to reduce our frontier market exposure to foreign exchange risk by reducing the USD borrowing. So as at end of quarter three 2024, our USD debt represented approximately about 52% of total debt for Axiata, which is aligned with our aspiration to reach a 50-50 mix between local and USD currency debt. On the right is something which is tracked very, very closely, not only by us, but also by the investor community at large. This is our net debt and also our rating agency, the net debt to EBITDA ratio. As you can see in 2023, at the end of 2023, it spiked to about 3.36x .
But however, as at quarter three 2024, it had come down to 2.59 x, mainly due to not only the debt reduction that we've done on an absolute basis, but also the improvement in EBITDA that we've seen across our OpCos. So as such, you can see in the bullet, EBITDA growth of 10% was followed by another 14.6% by quarter three 2024. However, the effort to optimize the balance sheet is a continuous thing. So we will look at opportunities for us to, for example, redeem more of our U.S. dollar debt going forward. However, the main target that we have, I probably have it later on, the main target is to reach the 2.5x time of net debt to EBITDA by end of 2026.
So around balance sheet optimization, again, it's mainly governed under the Board Investment Committees, both at Axiata Group, but also in the individual OpCos, and it's supported by the Axiata Treasury and Management Committee. Right. Finally, why are we doing all this? Why do we do financial? Why do we do capital management? It's essentially to enable us, as I what I had said earlier, to enable us to meet our promises and our that we've made to our shareholders from the last investor day. First is the delivery of a dividend per share of MYR 0.10 per annum. Second is to deliver a high single digit total shareholder return per annum. And thirdly, as what I alluded to, is to deliver net debt to EBITDA of lower than 2.5x by end of 2026. So with that, I think I've come to the end of it.
Thank you very much, and I'll pass it back to Clare.
Just, you know, when I talk to some of the analyst investors, they basically say that, are you hands-off, hands-on? How are you managing these assets where you do not control? It's easier to, you know, manage those assets where you have clear operating control. Having said that, I think the two major assets of ours, whether it's CelcomDigi or now in future going to be XL Smartfren, I think we do jointly control with our partners. So the alignment with partners in terms of common objectives, common strategy, and common way forward is extremely important for us. And that's how we basically try and manage these operating companies. And we are quite involved, engaged, hands-on on how we are running these operations because these still contribute a significant part of our portfolio.
So let me just quickly touch upon, you know, this is clearly how the CelcomDigi is, where we own 33% and Telenor owns 33%. And there is a joint control between the two of us with six out of the 10 seats which are there in the board with the principals. In a similar format is what is going to be in XL Smartfren case. So the board is going to be a nine-member board where there are three nominees from our side, three non-independent, and three nominees from Sinar Mas Group. And there would be three independent, one nominated by us, one nominated by them, and one jointly nominated. So it's a structure that is pretty much similar where six out of the nine of the board members would be jointly nominated and would be non-independent in nature.
So how basically I think the important part of this is obviously the first three on the top are the board processes, the AGM process, and the committees. What we've also looked at is, you know, in specific in certain companies like XL Smartfren, we think there is a need for us to strengthen processes around the investment decisions, procurement decisions, et cetera. So there is a committee we've introduced in this in XL Smartfren, which is on the technology as well as on investments and procurement, which are basically governed by the shareholders. The objective is not to slow down the decision-making process, but to ensure that both shareholders are kind of aligned in terms of how the processes and the objectives need to be met.
But more importantly is the last two, where how do we engage with the management with regular touch points on technology, financial performance, risk management, and people processes, and also how do we actually bring in common practices, best practices, which we have in both of the companies, which is Telenor as well as Axiata, into the process of improving the performance or the enablement of the operating companies. So, for example, in the case of CelcomDigi, we do have very clear alignment discussion between the shareholders on strategy, business planning, performance management, and that's something which we take it down with the management. Similarly, on the risk and compliance processes, people and remuneration, and network and technology. So all of them are jointly done with the management along with the representatives from the shareholders.
So I think that's kind of in a way we ensure that the working and the objectives to be met of the company are all aligned at the shareholder level. I mean, there are obviously going to be differences of opinion between the shareholders, but we try and ensure that that part is not something which is brought into the board discussions, but we do those discussions in advance. For example, I think, let's say the objective is to maximize dividend in CelcomDigi, if that's what we want to drive. So what is it that's going to be the key drivers for us to achieve that? So those alignment discussions with the shareholders happen in advance. So I think that's broadly how we look at associates. And why to me is important is because that's the direction in which Axiata as a group moving. We're becoming more a portfolio kind of manager. How do we extract the best value of the investments which we make in various companies? And these two are going to be a substantial part of our investments here. So that's a little bit around that.
So anyway, we will move on to the last agenda of the day, the Q&A sessions. I believe we have three moving mics on the floor. So if you have any questions you would need to direct to either Vivek, Nik, or any of the CEOs, we'll be happy to take your questions. If you would put up your hand and we will send a mic over to your direction very quickly. Foong again from CIMB.
Thanks again. A couple of questions from me. Firstly, I wanted to ask about the balance sheet, right? Nik, you mentioned about the improvements. In fact, the net debt to EBITDA looks like you're going to reach the target one year in advance, right? Especially given the consolidation in Indonesia, you will already be at that level by probably April or May. So I wanted to ask what is next in terms of your balance sheet plans? And then is there room for us to start thinking about gradually raising the DPS, the dividend going forward from here? That's question number one, and then second question, perhaps for EDOTCO. Just now, Adlan was saying that in the Philippines, there's some in-market consolidation, and perhaps even in Malaysia, there are Red States where perhaps there could be more acquisitions going forward. I wanted to understand whether EDOTCO would be involved in some of these in-market consolidations and in terms of the capital needs, right, at EDOTCO going forward, what is it going to look like? Yep, those are my two questions. Thank you.
I'll take the first one. Foong, thanks for the question on the balance sheet. Yes, the whole idea about improving your balance sheet and this is basically via and the main driver for that will be via the reduction of the HoldCo debt, right? Because as you can see, as at quarter three, HoldCo debt in itself accounts for approximately almost like one third, right? It's MYR 8.3 billion out of the MYR 22.2 billion worth of debt, right?
The ability for the company to—it's always our aspiration to progressively, and I think this is something that we said we will progressively increase the dividend per share from MYR 0.10 per share going forward. I think the plan for 2025 is still MYR 0.10, but going 2026, upon the success of us reducing our HoldCo debt further, we should be in a position whereby we are able to progressively increase the dividend per share amount. And if you think about it, it's just the simple math of whatever savings that we have from not having to make interest payments to service the coupon for the debt can technically be seen as additional dividends that we are able to return back to shareholders. That's basically on the balance sheet. Was there another question to your balance sheet question just now?
No, I think that's it, right?
The other one is on EDOTCO. Yeah.
I'll just add, I think, yes, I mean, two questions. I'll break it down. One is earnings per share, and second is the cash flows and the balance sheet consequence. I think Nik is right. I think we look at the HoldCo debt as an important element, not the overall balance sheet. I think overall balance sheet is sustainable. It's more about the leakage which happens because of the large HoldCo debt on whatever the dividend flows. You have to service the debt at the holding company level. So I think that's very clearly we want to bring it down. So the focus is a lot around HoldCo debt, not necessarily the overall. I mean, if you saw balance sheet and all the operating companies is still manageable. It's more the holding company.
So that's the objective which is there. Earnings per share, I think we will still see some effect of the consolidation we are doing. So you might not have earnings per share in the next year or two reflective because of the consolidation in Indonesia. But I think, I guess, in the next couple of years when we start getting the synergies, once the integration, et cetera, is behind us, because even now in CelcomDigi, as Datuk Idham mentioned, that we've just finished 75%, there's still 25% of the towers, sorry, the towers to be modernized, it'll still have some stress because of the integration cost, which will have impact on the. So if you look at two years, three years down the line, I think earnings would be strong. Having said that, I think we still feel strong cash flows and the reserves available with us. We should still be able to meet the dividend per share expectation of the shareholders. Maybe on the towers, we hand over to Adlan.
So, hello. I think on acquisition, first and foremost, I think at EDOTCO, when we talk about acquisition, there must be a strategic objective attached to it. If you look at the acquisition we did, yeah, it's a platform that we built in going into new countries, either Philippines or in the case of Indonesia. In Malaysia, when we did, it's in the Red State, right? States that we cannot build, right? So our objective is predominantly on strategic acquisition, right? It's not so much on growing scale per se, right? So I think in the Philippines, it's key today that you see that the industry is consolidating.
Yeah, a lot of the smaller guys are probably exiting today. And you'll probably see a number of acquisitions have already started or mergers have actually been kicked off, right? And I think you'll see that more of this is going to happen this year. I think we are a big proponent of that, and we think it's important that the tower industry gets consolidated in the Philippines. In that sense, I think the way you look at it, valuation from the first acquisition of tower multiple was a little bit high, right? So typically, I think if you look at some of the smaller acquisitions today, valuations are still high. It's still, it's not in the mid-teens, but it's still in the low-teens. It's still very high, right?
Our view on this acquisition, M&A in this market is probably more on how we do a merger because it's probably more on people with already an asset portfolio that you can do and share swap, right? The high and high, right? And I think that's the thinking of what we're having today. So putting a bit more capital at a high valuation, something that's not going to work for us. Yeah, so in Malaysia, it's again, right? Red State probably a lot more strategic for us. It's opening up a new market.
However, I think the way that we look at this, typically, you know, acquisition is one means to get access into Red State, but also there's a way in terms of doing a partnership, yeah, in terms of how you work with some of these partners, which we are trying to, we do have a couple of Red States today that we are working on this partnership, right? So not necessary in terms of acquisition, but maybe slightly in terms of a new partnership model or even to a certain extent of getting a new OSA in some of these states because you bear in mind that some of these states, for example, the penetration, the connectivity are very bad. I mean, that means the existing OSA or whatever partners that's deploying is not doing a good job, right? There's a lot of pressure that the states are putting in. MCMC is putting in, and there are opportunities potentially to secure new OSA. Not necessarily acquisition, but also can be in terms of partnership or securing a new license in terms of operating the OSA.
Okay, and just maybe just going back to Vivek, right? For EDOTCO, is that a very strategic asset for Axiata, or is it subject to valuation given the recent news on some bids for EDOTCO? Can you sort of give us an idea of the strategic direction there on EDOTCO?
So I think if you saw that one slide of mine which said long-term strategic and the others are valuation stroke monetization, the four assets which sit on the valuation stroke monetization. Clearly I think that directionally those are the ones where we think we have still an opportunity to create value and EDOTCO would monetize some of those assets. Now, whether we will be a minority, whether we will be still in control, it all depends on the process we follow, the right kind of investor coming in to take care of that asset. So that's the consequential, but clearly the objective is to drive valuations for these assets and ability to monetize. I mean, EDOTCO, for example, I think Adlan has agreed to give some small dividend this year, but there's nothing we've got. So there's got to be an opportunity for us to get some money out of EDOTCO, right?
Okay, thanks.
We have a Prem in the center of the ballroom.
Thank you for the opportunity. You know, this probably goes against some of the stuff that's been said, but as we reduce the HoldCo debt situation and the overall balance sheet looks better, is there an opportunity for us to re-look how we address some of these markets instead of being focused on cost cutting? Are there any markets you feel that you can be a lot more aggressive by using that balance sheet to gain market share? Is that something to consider?
See, I'll tell you, Prem, I think last year when we presented, we had fundamentally four big challenges, which is what we are trying to solve, right? One big challenge was long-term sustainability in Indonesia, right?
I mean, XL standalone would have been tough to fight in the market. We are two big guys, right? So I think we are solving that problem with the merger. Second was long-term sustainability of Link Net because that was still a stress on us. So I think we are trying to solve that problem by delayering and also looking at, you know, possible another partner or shareholder coming in, right? Third one we are solving is really around the long-term position on EDOTCO, right? Which is what Adlan talked about, you know, what he's trying to do to recover, gain value, and then we might be able to monetize some of these things, right? All that's done. So the fourth one was overall balance sheet, I think, which Nik talked about in terms of how we've been able to reduce our balance sheet, improve capital productivity, et cetera.
So all those things I think will put us in a very, very strong position as a corporate where leverage would be low. We would have solved challenges which are there. Then I think the next task for the management is what are the opportunities of further growth, whether it's in the existing footprint or do we look at alternate options. I think the board's mandate is first solve the A while you prepare for the B. So I think we are still in the solving A, and in our mind, we are looking at what are the other opportunities which are there, but it does give us that position to do those decisions. But without solving A, it's tough for us to start thinking really about BA. So that's, I think that's pretty much the frame. But having said that, we will still be a very strong connectivity player in these markets, and we may be able to build revenues on top of what we are doing on connectivity in these markets.
Yeah, I suppose one of the things which, given the history over the last 15 years or so, is there a risk once we fix the balance sheet that we start trying to go and expand the empire again? Do you think there is?
I don't think, at least my board will not allow me to do that. Yeah.
All right, perfect. Thank you very much.
Hi, Ziyad from HSBC here. Thanks for having us today. My questions are related to your liability management exercise, and so my questions are, are you planning to do one perhaps in the next 12 months? And if yes, what are the parameters you're looking at in terms of timing, pricing, and quantum? And then second question would be, would you be able to share your aspirational EBITDA growth targets that say for 2025 and 2026?
Yeah, or do you want to?
Goes to both Nik and.
Yeah, yeah. So I think in terms of liability management, the exercise that we did last year was actually quite optimistic. We did plan, and we looked at the market quite closely, and we felt that it was at an inflection point in time whereby it was just before the interest rate cuts that we saw that the Fed took, right? Because as soon as the Fed cut the rates, then the prices will start going up.
So while it was still at a relatively low level, we took the opportunity to actually go out in the market to try and mop up or redeem, get some early redemption of some of these papers, which we were successful utilizing the spare cash that we have at that particular point in time. Moving forward, again, there's a lot of volatility at the moment, and there's also a lot of uncertainty. I suppose we'll have to wait and see what the new president of the United States does. When he comes in, in about 10 days' time or something like that, 20th, I think, which is not that long to go. But until then, there's also other factors, right? All the geopolitical risks, and we just need to have a view in terms of what movements, what other interest rates kind of like movements are going to be like. That said, we do have some papers that are actually coming to maturity. So we've got some MCTL that's coming to maturity this year in 2025, and we also got some that's already going to, the Sukuk that's going to be coming to maturity in 2026. So in between, we'll try and see whether we can be optimistic again, but it all depends on our cash level and whether it makes sense for us.
There's a question at the back there.
Thank you. Hi, I guess first question on XL front, with the merger, we'd have three telco brands in the telco front. So over time, how do we think about reducing the number of brands and reducing the number of SKUs in Indonesia that we have? Is there a plan that we have that we can share?
So I think in Indonesia, I don't think immediate priority for us is to consolidate the brands, right? So we still have three brands, right? Smartfren's there, Axis is there, and XL is there. Our first priority is to ensure that we get the consolidation of the network, synergies coming out of the network, and hold and grow philosophy, which means you hold the number of customers and grow the number of customers by the ability to reinvest into the markets where our network is weak, right? So I don't think that's the immediate decision which has been taken. So we'll go in with three brands.
Over a period of time, once the management is comfortable that the integration strategy is falling in place, we're able to get the best synergies out, we're able to maintain our customers and grow them, then I think the decision would be made whether it's time for us to consolidate or not. Because one of the issues in Indonesia and like some of the other markets is positioning of the brands is not very distinct. So you need to first position the brands distinctly before you make decisions, otherwise you might end up just losing customers here. So I think philosophy is hold and grow the customers before you start consolidating the number of brands.
and between XL and Smartfren, there's obviously a large ARPU gap. So have we thought about a strategy of how over time we'll be looking to narrow this gap? Or again, to your point, after consolidation, we'll think about this.
No, I think, I mean, the experience has been that, look, we've seen that experience in Bangladesh, even, and Sri Lanka. When you consolidate the telco or the network which had poor customer experience, it starts getting a much better customer experience because the network improves for that particular. So hopefully that should help us drive much higher ARPU. Having said that, I think what we've seen is Smartfren has got very large tail, but they've got very loyal, strong ARPU customers, and that customer base around, I think, 19 million customers, their ARPU is exactly similar or even better than what XL is. I think with the better network which we can provide them, the ability to retain them and also grow their ARPU is, I think, a big opportunity we have in that. A lot of them are actually present in Central Java, which is a high ARPU market in Indonesia. That's, I think, something which we will focus on. How do we retain and actually grow that large loyal customer base of Smartfren?
On the broadband front in Indonesia, PT Telkom with IndiHome has launched Eznet, which is on a much lower price point of IDR 120,000-IDR 150,000. How do we, what's our strategy to compete in this segment of the market?
No, I think we have been, first of all, I think our strategy is converged. We are selling converged, which is mobile and fixed converged offer to our customers. I think we are also utilizing the media partnership which Link Net has to be able to offer the right kind of content to the customers. And it's going to be a very targeted markets approach, not just going across all the markets at low ARPU. So I think the objective is how do we kind of retain ARPU. Yes, there will be some cannibalization which is happening, and that's where I think overall cost structure to support that kind of growth would be important. But it'll be a very, very targeted approach to fixed broadband in that market.
And just one last question related to the previous question on once we have done the XL merger, EDOTCO, Link Net, potential strategic stake sales, and net debt position is much stronger. Strategically, have we thought of at least directions where we will look for growth eventually in the next four years?
No, so I think, I mean, if you, we will be as strong. I mean, if you look at the presentation, Asia connectivity leader. So I think clearly the main focus for us would be to focus on mobile, fixed, converged play or connectivity play in all our markets. And also on top of that, new services which we can offer to our players. And that I think should be able to drive very strong earnings as well as very strong yield. And then there will always be a time where we need to build the synergies from the XL Smartfren merger as well as a CelcomDigi synergy. So that should translate into strong earning opportunities for us. So that's, I think, the key focus would be for us. But then we look at other adjacencies to invest in closer to what we have on connectivity.
Thank you.
Thank you, Sukriti from BofA. Do we have any other questions? Okay. I think we are good then.
Must be because we're close to 6:00 P.M. or something.
Okay. All right then. I think if we are good, then we can allow Vivek to do a quick closing remark, and we can call it a day.