KUALA LUMPUR: CIMB Equities Research has upgraded TELEKOM MALAYSIA BHD [] from Neutral to Outperform and raised the target price from RM4.04 to RM5.10.
It said on Tuesday, May 24 that the take-up of TM's high-speed broadband (HSBB) offering, Unifi is taking off, prompting it to upgrade its call from Neutral to Outperform.
'Unifi's strong take-up, a rebound in Streamyx net adds, and wholesale revenue from Maxis and eventually Celcom underpin our 5-21% core EPS upgrades and increase in our SOP-based target price from RM4.04 to RM5.10,' it said.
CIMB Research said TM's capex is peaking this year, resulting in free cashflow yields of 9-12% for FY12-13 and gross dividend yield of 6-10%.
'Likely stock catalysts are Unifi's strong take-up, the inking of an agreement to wholesale HSBB to Celcom and the sale of Axiata shares. We view TM as an excellent play on fixed broadband and data, which is one of the fastest-growing telco segments in Malaysia. TM is now our top Malaysian telco pick, followed by Axiata,' it said.
It said on Tuesday, May 24 that the take-up of TM's high-speed broadband (HSBB) offering, Unifi is taking off, prompting it to upgrade its call from Neutral to Outperform.
'Unifi's strong take-up, a rebound in Streamyx net adds, and wholesale revenue from Maxis and eventually Celcom underpin our 5-21% core EPS upgrades and increase in our SOP-based target price from RM4.04 to RM5.10,' it said.
CIMB Research said TM's capex is peaking this year, resulting in free cashflow yields of 9-12% for FY12-13 and gross dividend yield of 6-10%.
'Likely stock catalysts are Unifi's strong take-up, the inking of an agreement to wholesale HSBB to Celcom and the sale of Axiata shares. We view TM as an excellent play on fixed broadband and data, which is one of the fastest-growing telco segments in Malaysia. TM is now our top Malaysian telco pick, followed by Axiata,' it said.
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