Indonesia’s three largest tower companies are likely to slow down their construction of towers by 25 per cent this year, after aggressive building over the past year.

The three tower firms – Profesional Telekomunikasi (Protelindo), Tower Bersama Infrastructure (TBI) and Solusi Tunas Pratama (STP) – are forecast to roll out 2,900 towers this year, after building 3,900 towers last year, according to Fitch Ratings.

The country’s three largest operators are expected to suspend orders for towers until early next year, when the Ministry of Telecommunications and Information Technology is likely to update the country’s spectrum regulations and allow operators to roll out 4G services.

Fitch expects market leader Telkomsel to lead tower demand this year, but its demand is likely to be lower than in 2014, as will Indosat’s, as its network investment falls after it recently completed its network modernisation. XL Axiata will also postpone its network expansion as it focuses on reviewing its overlapping networks after it completed the acquisition of Axis Telecom last year.

Protelindo, TBI and STP added around 200 towers in Q1 – down from 700 towers in the same period a year earlier.

Fitch forecasts Protelindo and TBI to build fewer than 1,200 towers each this year after building more than 1,800 new towers each in 2014; while STP is likely to build fewer than 500 towers. This will reduce the companies’ capex and generate additional free cash flow, which could be used to deleverage their balance sheet.

Fitch, however, estimates that the organic growth of independent tower companies will resume in 2016 when new tower additions pick up.