About Axiata Group Bhd

Axiata Group Berhad is a Malaysia-based telecommunications company, which manages Axiata Group. The Group has controlling interests in six mobile operators under the brand names of 'Celcom' in Malaysia, 'XL' in Indonesia, 'Dialog' in Sri Lanka, 'Robi' in Bangladesh, 'Smart' in Cambodia and 'Ncell' in Nepal, as well as minority interests in 'Idea' in India and 'M1' in Singapore. Axiata Group's products and services include prepaid and postpaid mobile services, television broadcasting and cable television services, Internet services, enterprise solutions, digital marketing and e-commerce services, mobile advertising and machine-to-machine (M2M) solutions, among others. Via 'edotco', its infrastructure company, the Group also delivers telecommunications infrastructure services and operates telecommunications towers regionally. Other regular undertakings of the Group include investment holding and the distribution of communication device and related products..

The most notable director in Axiata who is influential to the society is Tan Sri Dato’ Azman HJ. Mokhtar, who is currently the CEO of Khazanah Nasional Berhad and Chairman of Axiata Group.

largest manufacturer of frozen Asian food delicacies.

Based on Financial Year (FY) 2016 full year results, Axiata achieved RM 21.6 billion turnover, which is categorised as a large multinational company based on turnover value. Other aspects of the company’s FY2016 financial results are illustrated in the table below.

Axiata’s revenue has been on a upward trend from RM 17.7 billion in FY2012 to RM 21.6 billion in FY2016 which translates to a 20% increase in 4 years. In terms of net earnings, Axiata experienced a sharp drop in FY2016 from RM 2.6 billion to 0.6 billion due to decline in performance at its Malaysia, Bangladeshi and India businesses, higher depreciation and amortisation, net finance cost and forex losses.

Net profit margin wise, Axiata scores extremely low at 2.94% margin, as compare to its peers who are achieving profit margin at the range of 20%. Return of equity (ROE) wise Axiata scores a low value as well at 2.14%

On company’s debt, Axiata has a decent debt to equity ratio at 1.00, which is common in telecommunication company due to high initial infrastructure investments needed. The company’s both current ratio and cash ratio are of  below average values at 0.53 and 0.13 respectively.

Axiata pays a low dividend yield of 1.4% in FY2016, as compared to other telcos  which pays a dividend yield ranging from 3% to 5%. Axiata’s dividend payout ratio of 1.4 shows that the company is paying more than what it earns, which is unhealthy for the company’s growth.

In conclusion, Axiata’s financial health is no longer as good as before due to the sharp drop in profit for FY2016, causing its PE ratio to jump from 20 to 96.90. Moreover it is paying a low dividend yield of 1.4% makes it unattractive as compared to other telecommunication companies who are paying higher dividends.

Moving forward, Axiata targets to strengthen its position as a leading telecommunication service provider in Asia region through more Capex allocation to improve coverage and network quality, as well as explore new growth areas such as Advertising, Digital Financial Services and B2B (Business to Business) solutions.

(Next quarterly results announcement: Last Week of Feb 2018)

News on Axiata Group Bhd

According to The Star news, Axiata Group has recently announced that its subsidiary, dialog Axiata PLC has taken a 50.59% stake in e-learning solutions and digital education provider Headstart (private) Ltd. Dialog’s investment totalling US$640,000 was through a subscription of bonds, which may be converted to equity over time with the initial conversion resulting in a 26% equity stake in Headstart in 2015. With the conversion (dated Jan 1, 2018) of the last tranche of these outstanding bonds, Dialog increased its stake in Headstart to 50.59%.

More over, Celcom Axiata Bhd is welcoming a new player in the local telco industry called Yodoo. However, CEO Michael Kuehner mentioned that the industry needs more consolidation instead of another player. Kuehner expects a flat growth in this industry because of the decline in revenue for the past three years.

On another matter, analysts are still banking on the merger between Axiata and Telekom Malatysia to set the tone for an industry consolidation, which is deemed as the logical route forward.

iVolume Spread Analysis Weekly Chart & Comment – Axiata Group Berhad

Based on 1-year weekly iVSAChart above, we notice currently Axiata is trending up nicely at Mark-Up stage (Stage 2) since early of September 2017 with potential return of 10.8% from the buy signal. The changes in trend are confirmed & indicated by Market Structure in iVSAChart.

We believe the uptrend for Axiata will continue as there are lots of Sign of Strengths (SoS) since September 2017. The SoS are indicating support from Smart Money. The chart above also indicated no Sign of Weakness (SoW) for the past 6 months and this have illustrated that the Smart Money are yet to distribute their stocks.

Interested to learn more?

Sign up now via the URL link below to receive a series of FREE weekly GE14 newsletter with stock analysis for the next 10 weeks leading up to the GE14 election, where we analyse the major financial news and company background in these GE14 stocks specially just for you.

http://ge14.ivsachart.com/

P.S Upcoming events

1. Market Conference & Investment Outlook 2018

Malaysia is expecting to undergo its 14th General Election (GE14) anytime within the 2nd quarter of 2018. The uncertainty leading up to the 14th general election and the results after the election will affect the country’s markets and its economy with many consequences. But the main question here is, how is Malaysia GE14 going to affect the country’s stock exchange? Featuring high-profile speakers we will share with you How the General Elections this year will Impact the Stock Market and also how you can identify stock opportunities with Growth Potential! Click the link below to find out more!

https://www.ivsachart.com/investconference2018.php

2. Monthly Mini Workshop

Find out more about our iVSAChart mini workshop schedules via: https://www.ivsachart.com/events.php or attend via webinar for the upcoming workshop: https://register.gotowebinar.com/register/5918645092666604803

· Find out more about iVSAChart events via: https://www.ivsachart.com/events.php

· Follow & Like us on Facebook via: https://www.facebook.com/ivsachart/

· Subscribe to our YouTube Channel via: https://www.youtube.com/ivsachart/

· Contact us via: email at sales@ivsachart.com or Call/WhatsApp at +6018 236 9060/ +6018 286 9809/ +6019 645 3376

Disclaimer

All views or opinions articulated in this article and/or related website are expressed in iVSA Mobile Technologies and its writers’ personal capacity and do not in any way represent those of the company, their employers and other related parties.

All published posts and materials made do not constitute as investment advice or recommendations for buy or sell call. iVSA Mobile Technologies and its writers do not take responsibility whatsoever for any loss or damage of any kind incurred from opinion or materials presented in the article and any other materials.

All materials presented are for knowledge sharing purposes and while iVSA Mobile Technologies and its writers will take the best efforts to produce materials that are as accurate as possible based upon publicly available sources that are believed to be reliable, but there is no guarantee as to accuracy of the information provided. All posts may be edited in the future without prior notice.

Conduct your own research and assessment before deciding to buy or sell any stock. If you decide to buy or sell any stock, you are responsible for your own decision and associated risks.