Telekom Malaysia (Company Update): Riding on the fixed line growth

Stock Name: TM
Company Name: TELEKOM MALAYSIA BHD

Research House: ECMLIBRA

Price Call: HOLD

Target Price: 4.78

Maintain HOLD; TP: RM4.78

Weare positive over TM's HSBB Unifi growth momentum that has beefed up FY11internet revenue which we believe would further drive up future growth.However, our HSBB Unifi net adds assumption is on the conservative side toaccount for competitions going forward. Consequently, after revising earningsby 1%-24% in FY12-FY14, we upgrade our TP from RM3.70 to RM4.78 based on theGordon Growth model imputing 4.5% long term growth and 30 sen per share ofcapital distribution in FY12. However, given the rich valuation, we maintainHOLD on TM

Source: ECM Newz Bits 14 March 2012, Full PDF Report