تقرير الرياض المالية عن شركات الاتصال

[ssami101]

تقرير الرياض المالية عن شركات الاتصالات في المملكة....
حيث حددت السعر المستهدف لشركة الاتصالات بـ 52 ريال وموبايلي بـ 88 ريال وشركة زين بـ 10.75 ريال

تحياتي

It was a year ago that we called 2012 the year of the telecoms (see “Sales at the Expense of Margins” STC 4Q2011 FL note of Jan-21-2012) as the TTI outperformed the TASI with +29.7% gain versus +5.9%. STC and Mobily shares delighted investors with +28% and +45% returns during the year. While Zain KSA rally fizzled in the back-half on slowing sales growth. Recent CITC data indicates a decline in total mobile subs to 53.1 million in 3Q2012 (-5.3% Y/Y) as a result of implementing ID verification regulations. Prepaid subs represent about 85% of total mobile subs. We expect a strong finish to 2012 for STC and Mobily, thanks to the seasonal boost provided by Hajj pilgrims which reached 3.2 million. For Zain KSA we look for signs of reclaiming market share.

STC: Tower Deal Will Not Impact 4Q2012Recent media reports have indicated that STC’s subsidiary in Indonesia “Axis” is planning to sell $300 million worth of towers to Tower Bersama Infrastructure and Sarana Menara Nusantara. The deal is expected to complete in 1H2013 and result in lower maintenance expense. Further STC, along with QTel and Etisalat, appear interested in acquiring Vivendi’s 53% stake in Morocco’s Maroc Telecom. The deal size is estimated at $7 billion. We forecast 4Q2012 revenues at SAR 16.2 billion (+6% Y/Y, +11% Q/Q) and gross margin of 54.8%. Typically margins are lowest in the final quarter due to higher interconnect costs resulting from Hajj traffic. We estimate EBITDA of SAR 5.6 billion (+12% Y/Y) and a -7% Y/Y decline in EPS to SAR 1.06, versus Bloomberg consensus SAR 1.16, on higher finance costs. We note that the average USDTRY exchange rate has remained constant Q/Q which should limit currency impact on the bottom line. Quarterly DPS is expected to remain constant at SAR 0.50. Reiterate Buy rating and SAR 52 target price.

Mobily: Halt of SIM Sales Should be ImmaterialDuring 4Q2012, Mobily announced signing an MoU with Etihad Atheeb Telecom which could result in greater access to fixed line offering for Mobily to counter STC’s triple play over the longer term. In addition, the Board will seek shareholder approval to increase capital by 10% to SAR 7.7 billion at the next AGM. Non-compliance with CITC directive for ID verification resulted in temporary suspension of sales of new pre-paid SIMs. The issue was quickly resolved and is expected to have negligible financial impact. We project another quarterly DPS of SAR 1.00 taking the full-year dividends to SAR 4.00. Overall we expect another strong quarter for Mobily with +13% Y/Y and +6% Q/Q revenue growth to SAR 6,542 million. EBITDA of SAR 2,472 million (+7% Y/Y) should see sequential margin improvement to 37.8% from 35.6%. We forecast 4Q2012 EPS at SAR 2.51 (+4% Y/Y and +6% Q/Q), slightly ahead of consensus SAR 2.50. Reiterate Buy rating and SAR 88 target price.

Zain KSA: Sales Growth Needs to ReturnZain KSA announced on Dec. 12th that parent Zain Kuwait will pay some SAR 868 million of notes payable on its behalf to vendor Motorola. The payment amount will be added to founding shareholders’ loan which totaled SAR 1,630 million at end-September. In addition, Zain KSA is continuing negotiations with lenders to refinance its SAR 9.75 billion syndicated loan in a bid to lower interest burden. The latest extension of the loan due date will expire on Jan. 30th. We note that marketing activities have picked-up and could yield some resurgence in sales growth. We are looking for total sales of SAR 1,684 million (-2% Y/Y) and EBITDA of SAR 228 million (-12% Y/Y). Operating loss widened in the third quarter to SAR 305 million and is expected to narrow to SAR 187 million in 4Q2012. Net loss is projected at SAR 423 million. We maintain our Hold rating and SAR 10.75 target price, representing 1.8x 2013E sales

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