Indonesia's second largest telecommunication company PT Indosat has set aside a minimum of 1 billion U.S. dollars in capital expenditure this year to bounce back from slower growth last year.

Indosat, whose 42 percent stake is owned by Singapore Technologies Telemedia, suffered a 13 percent decline in net profit to 1.41 trillion rupiah (approximately 154 million U.S. dollars last year), major national newspaper The Jakarta Post reported Monday.

"This year's net profit growth will be somewhat equal to income growth which is around 20 percent," Indosat Finance Director Wong Heang Tuck was quoted as saying.

Half of the 1 billion dollars capital expenditure is expected to come from loans.

"In the initial stage, we will issue bonds. After that, we will look for loans from bank syndications, dollar bonds or through other mechanisms," Wong said

Indosat marketing director Wahyudi Wijayadi said the company planned to use the fund to expand its telecommunications network, including building another 3,500 to 4,000 base transceiver stations across the archipelago.

"Through that, we aim to attract about 5 to 6 million new customers," Wahyudi said.

As of 2006, the company had a total of 16.7 million cellular phone subscribers.

According to research conducted by Credit Suisse, Indonesia's cellular market, including fixed wireless phones, could grow by 24. 8 million new subscribers in 2007.

(Source: Xinhua English)