RHB Research has maintained a “BUY” recommendation for Axiata Group Bhd with an unchanged TP of MYR4.84, 31% upside with c.3% yield. Axiata’s Investor Day (AID 2021) reaffirmed the group’s aspirational targets to become a digital champion and high dividend company by 2024.
RHB said that it remains upbeat on its prospects with a strong earnings rebound in FY21F and Our TP includes a 2% ESG premium based on our in-house methodology. “Key risks: competition, regulatory issues, and weaker than expected Celcom-Digi merger synergies,” it said.
It said that the group is on track to achieve the targets of; DPS of 20sen/share, cost/GB of 20%, and ROIC>WACC by FY24F.
It said that the pandemic has nonetheless stymied data profitability on falling data yields (blended cost/GB has fallen to USD0.33 vs initial forecast of USD0.36 with revenue/GB at USD0.32) with profitability pushed back by another year to FY21F.
