Telekom Malaysia: Potential National 5G Infrastructure Provider In The Making

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About: Telekom Malaysia Berhad (MYTEF)
by: The Value Pendulum
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The Value Pendulum
Deep Value, growth at reasonable price, contrarian, micro-cap
Summary

Telekom Malaysia has an intention of becoming the national 5G infrastructure provider, servicing mobile operators, and this is contingent on securing the relevant spectrum and obtaining approval from the regulators.

Cost optimization has helped the company deliver positive EBITDA growth in 3Q2019 and 9M2019, but capital expenditures could spike in 4Q2019 and beyond.

Further ARPU dilution for Telekom Malaysia's broadband business is expected due to its recent marketing campaign and the government's plans to make broadband affordable.

Telekom Malaysia trades at 6.0 times consensus forward next twelve months EV/EBITDA and offers a consensus forward FY2020 dividend yield of 3.1%.

Elevator Pitch

Malaysia-listed telecommunications services provider Telekom Malaysia Berhad (OTC:MYTEF) [T:MK] has provided clarity on its mobile plans recently, suggesting that it intends to become the national 5G infrastructure provider, providing mobile operators