PublicInvest 'neutral' on Telekom Malaysia
KUALA LUMPUR: PublicInvest Research maintains Neutral call on Telekom Malaysia (TM) with a target price of RM5.70 which is under review, subject to further details on its acquisition of Packet One Networks (P1).
"TM's share price has run up in past weeks in anticipation of the P1 acquisition, and whether the share price run-up is justifiable or not depends on the
pricing and structuring of the potential acquisition.
"TM's share price has appreciated 11.3 per cent in the past one month in response to market talks of it acquiring a stake in P1 to grow its wireless
business. Pending further details announcement, we maintain our Neutral call on TM," PublicInvest said in its research note today.
TM and Green Packet have requested for suspension for the trading of both companies shares pending the announcement on a material transaction.
It was reported that TM is believed to have acquired a stake in P1, a subsidiary of Green Packet. Green Packet owns a 55 per cent-stake in P1 which is one of
the pioneers in Malaysia to launch WiMAX services (wireless broadband). P1's other significant shareholder is South Korea's SK Telecom.
P1 owns 30MHz in 2300MHz band which is currently used for WiMAX network and 20MHz in 2600MHz band which can be used for 4G-LTE services. In addition, P1 is believed to have more than 1,900 base stations and has a customer base of more than 500,000.
In September last year, TM's CEO was quoted in an interview that the company will be exploring to expand its wireless broadband services in underserved
areas, in particular rural areas. TM will be aiming for 100,000 users on its LTE network within 2014 and more than one million LTE subscribers by 2017.
pricing and structuring of the potential acquisition.
"TM's share price has appreciated 11.3 per cent in the past one month in response to market talks of it acquiring a stake in P1 to grow its wireless
business. Pending further details announcement, we maintain our Neutral call on TM," PublicInvest said in its research note today.
TM and Green Packet have requested for suspension for the trading of both companies shares pending the announcement on a material transaction.
It was reported that TM is believed to have acquired a stake in P1, a subsidiary of Green Packet. Green Packet owns a 55 per cent-stake in P1 which is one of
the pioneers in Malaysia to launch WiMAX services (wireless broadband). P1's other significant shareholder is South Korea's SK Telecom.
P1 owns 30MHz in 2300MHz band which is currently used for WiMAX network and 20MHz in 2600MHz band which can be used for 4G-LTE services. In addition, P1 is believed to have more than 1,900 base stations and has a customer base of more than 500,000.
In September last year, TM's CEO was quoted in an interview that the company will be exploring to expand its wireless broadband services in underserved
areas, in particular rural areas. TM will be aiming for 100,000 users on its LTE network within 2014 and more than one million LTE subscribers by 2017.
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