About Maxis Holdings Bhd

Maxis Berhad is a Malaysia-based investment holding company, which manages Maxis Group operating in the telecommunications industry. The Group is principally engaged in the provision of telecommunications and digital services, as well as the sale of devices.

Its major business activities include the supply of mobile prepaid and postpaid services, fixed line services, as well as provision of network facilities, other converged telecommunications, digital and related services, such as fixed wireless Internet broadband services. Maxis Berhad's subsidiaries include Advanced Wireless Technologies Sdn. Bhd., a provider of wireless multimedia services; Maxis Broadband Sdn. Bhd., an operator of a national public switched network and a provider of Internet services and applications, and Maxis Mobile Sdn. Bhd., an operator of mobile telecommunications for niche projects.

There are two notable board of directors in Maxis. First is Raja Tan Sri Dato’ Seri Arshad bin Raja Tun Uda, who is the Chairman, Independent Non-Executive Director of Maxis, at the same time is one of the director of Khazanah National Berhad. Second is Tan Sri Mokhzani bin Mahathir, serving as Senior Independent Director in Maxis, is also the son of Tun Dr Mahathir.

Based on Financial Year (FY) 2017 full year results, Maxis achieved RM 8 billion turnover, which is categorised as a huge corporation based on turnover value. Other aspects of the company’s FY2017 financial results are illustrated in the table below.

Maxis’s revenue is in a mixed trend for the past 5 years, with FY2013 having the highest revenue at RM 9 billion while the lowest revenue recorded is RM 8.38 billion in FY2014. However net earnings wise Maxis recorded the highest net earnings of RM 2.19 billion in FY2017 over the last 5 years, a 26% increase from the lowest earnings in FY2015 at RM1.74 billion.

Net profit margin wise, Maxis scores an excellent 25.21% and a very high Return of Equity at 31.13%

On company’s debt, Maxis has a high debt to equity ratio at 1.09, which is consider very low debt for a telco company. As for current ratio and cash ratio Maxis has an average value at 0.57 and 0.15 respectively.

Maxis pays a dividend yield of 3.38% with a payout ratio of 0.7. Although Maxis’s dividend yield is consider low for a telco company, the low payout ratio means the company preserves a substantial portion of its earnings for capital expenditure to ensure that they stay ahead of other players and remain competitive in the telco industry.

In conclusion, Maxis is a great company with healthy financials, fantastic profit margin and return of equity and consistent earnings over the years. Moving forward Maxis plans to continue its capital expenditure on expanding 4G coverage across Malaysia. In FY2016, Maxis invested RM1.2 billion in FY2016 and have expanded its LTE network to 88% of the population, covering more than 220 cities across Malaysia. This shows that Maxis is making good progress towards their ambition to be a fully digitalised Maxis to deliver the best digital experience to their customers.

Next quarterly results announcement is expected to be in the month of May 2018.

News on Maxis Holdings Bhd

According to India’s Economic Times, Maxis Communications Bhd may invest at US$500mil in its loss-making Indian telecom operations Aircel.

Maxis Communications – which holds a 74% stake in – and led by billionaire Ananda Krishnan remains committed to its loss-making Indian telecom operations after having invested US$7bil over a decade without generating returns, the newspaper said.

The Economic Times said Maxis Communications might look to invest at least US$500mil but the number could even double to US$1.1bil, depending on the company's final debt-resolution plan to fund capital expenditure and even buy back key tower infrastructure.

The company had sold its 4G airwaves to Bharti Airtel in anticipation of a merger with Reliance Communications.

The merger talks lasted nearly nine months, but eventually fizzled out due to the time taken for approvals, the newspaper said.

iVolume Spread Analysis Weekly Chart & Comment – Maxis Berhad

Based on the 12 months weekly iVSAChart, Maxis Berhad have gone through 2 months of distribution period from June to July 2017. The Market Stages for Maxis have turned to Accumulation stage since August 2017 with the support from Smart Money. The footprint of Smart Money supporting the price for Maxis are shown in the Green Arrow (Sign of Strength) as illustrated in the iVSAChart above.

However, the recently Sell Diamond appeared shown there are still supply in the market and the price are yet to ready to Mark-Up. Notice the Spring bar formed in earlier March is one of the evidence by Smart Money trying to remove the supply in the market. We will monitor Maxis closely to ensure the continuation support from Smart Money by looking at the Sign of Strength (Green Arrow) and Green Diamond before we trade. 

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