Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

Last Week in Event SPACE: SOHO China, Toshiba, Boral Ltd, Yageo/Chilisin, Microstrategy

Equity Bottom-Up

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<p>This week in StubWorld ...</p>
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<p>With <a href="https://www.smartkarma.com/entities/intouch-holdings-pcl" target="_blank" data-smartkarma-citation="entities:17638:1" rel="noopener">Intouch Holdings (INTUCH TB)</a> trading at terms to <a href="https://www.smartkarma.com/entities/gulf-energy-development-public-company-limited" target="_blank" data-smartkarma-citation="entities:26038:1" rel="noopener">Gulf Energy Development Public Company (GULF TB)</a>'s Offer...</p>
<p><em><strong>...What's the play here?</strong></em></p>
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<p>Preceding my comments on Intouch are the weekly setup/unwind tables for Asia-Pacific Holdcos.</p>
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<p>These relationships trade with a minimum liquidity threshold of US$1mn on a 90-day moving average, and a % market capitalisation threshold - the $ value of the holding/opco held, over the parent’s market capitalisation, expressed in percent - of at least 20%.</p>
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This week in StubWorld ...




With Intouch Holdings (INTUCH TB) trading at terms to Gulf Energy Development Public Company (GULF TB)'s Offer...
...What's the play here?




Preceding my comments on Intouch are the weekly setup/unwind tables for Asia-Pacific Holdcos.


These relationships trade with a minimum liquidity threshold of US$1mn on a 90-day moving average, and a % market capitalisation threshold - the $ value of the holding/opco held, over the parent’s market capitalisation, expressed in percent - of at least 20%.


StubWorld: Gulf's Curious Offer For Intouch Now Open

ASEAN Insight Provider, CrossASEAN Research

Angus Mackintosh

ASEAN Insight Provider

CrossASEAN Research

At CrossASEAN Research we strive to produce unbiased and differentiated on the ground insights on companies across South East Asia. Our Research is produced for the most part after face to face meetings and conversations with company management to dig deep into the long term vision and strategy of the companies we cover. We seek to deliver investable and actionable themes on sectors and markets across SE Asia, often in collaboration with other Insight Providers across the region, pooling the vast experience of the analysts within the Smartkarma Ecosystem. We also offer bespoke work and tailor made trips for our clients. 

Insights across South East Asia

Telekomunikasi Indonesia / Equity Bottom-Up

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<p><a href="https://www.smartkarma.com/entities/telekomunikasi-indonesia" target="_blank" data-smartkarma-citation="entities:1051:1" rel="noopener">Telekomunikasi Indonesia (TLKM IJ)</a> announced its results this week, which on the face of it do not look exciting, with revenues declining -0.7% YoY, EBITDA up by +0.5%, and net income up by +2.6%.</p>
<p>Beneath these headline numbers, there is a more compelling story, with Indihome seeing +25% YoY revenue growth driven by increasing subscribers and higher ARPU. Data traffic seeing +59.7% YoY growth 1Q2021, with the digital business now accounting for 76.9% of revenues in 1Q2021. </p>
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<p>The legacy SMS, fixed, and cellular voice declined by -25.4% to IDR5.3tn due to the cannibalisation from OTT applications such as Whatsapp. </p>
<p>The mobile segment in Indonesia remains competitive with the major players continuing to offer unlimited plans and other promotional plans but Telkom still realised data revenue growth of +0.4% YoY whilst digital services grew by +22.6% YoY, as the company added new services.</p>
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<section class="figure">After <a href="https://www.smartkarma.com/entities/telekomunikasi-indonesia" target="_blank" data-smartkarma-citation="entities:1051:1" rel="noopener">Telekomunikasi Indonesia (TLKM IJ)</a>'s investment in <a href="https://www.smartkarma.com/entities/gojek" target="_blank" data-smartkarma-citation="entities:25976:1" rel="noopener">Gojek</a>, the two companies have been integrating various aspects of their services to provide users with new benefits, as well as helping MSMEs to digitalise their businesses.</section>
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<section class="figure"><a href="https://www.smartkarma.com/entities/telekomunikasi-indonesia" target="_blank" data-smartkarma-citation="entities:1051:1" rel="noopener">Telekomunikasi Indonesia (TLKM IJ)</a> continues to augment the network reach and quality by increasing the number of BTS towers.</section>
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<section class="figure"> The wholesale and international business is supported by the tower and data centre business, with the potential for further growth from the rollout of 5G technology.</section>
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<p><a href="https://www.smartkarma.com/entities/telekomunikasi-indonesia" target="_blank" data-smartkarma-citation="entities:1051:1" rel="noopener">Telekomunikasi Indonesia (TLKM IJ)</a> remains a core proxy to Indonesia's digital economy and its growing appetite for data and broadband services. The company trades on 5.6x FY2021E EV/EBITDA and 4.8x FY22E EV/EBITDA versus the 5-year average of 6.2x forward EV/EBITDA, which makes it attractive even without any digital re-rating.</p>
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Telekomunikasi Indonesia (TLKM IJ) announced its results this week, which on the face of it do not look exciting, with revenues declining -0.7% YoY, EBITDA up by +0.5%, and net income up by +2.6%.
Beneath these headline numbers, there is a more compelling story, with Indihome seeing +25% YoY revenue growth driven by increasing subscribers and higher ARPU. Data traffic seeing +59.7% YoY growth 1Q2021, with the digital business now accounting for 76.9% of revenues in 1Q2021. 

The legacy SMS, fixed, and cellular voice declined by -25.4% to IDR5.3tn due to the cannibalisation from OTT applications such as Whatsapp. 
The mobile segment in Indonesia remains competitive with the major players continuing to offer unlimited plans and other promotional plans but Telkom still realised data revenue growth of +0.4% YoY whilst digital services grew by +22.6% YoY, as the company added new services.


After Telekomunikasi Indonesia (TLKM IJ)'s investment in Gojek, the two companies have been integrating various aspects of their services to provide users with new benefits, as well as helping MSMEs to digitalise their businesses.




Telekomunikasi Indonesia (TLKM IJ) continues to augment the network reach and quality by increasing the number of BTS towers.




 The wholesale and international business is supported by the tower and data centre business, with the potential for further growth from the rollout of 5G technology.





Telekomunikasi Indonesia (TLKM IJ) remains a core proxy to Indonesia's digital economy and its growing appetite for data and broadband services. The company trades on 5.6x FY2021E EV/EBITDA and 4.8x FY22E EV/EBITDA versus the 5-year average of 6.2x forward EV/EBITDA, which makes it attractive even without any digital re-rating.













Telekomunikasi Indonesia (TLKM IJ) - The Trend Is Digital

<div>
<p>This week in StubWorld ...</p>
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<p>Last Friday, 160mn shares of <a href="https://www.smartkarma.com/entities/intouch-holdings-pcl" target="_blank" data-smartkarma-citation="entities:17638:1" rel="noopener">Intouch Holdings (INTUCH TB)</a> - a 4.99% stake - traded after the close at Bt64.86/share. Investors de-risking? Temasek exiting (or adding)? Or <a href="https://www.smartkarma.com/entities/gulf-energy-development-public-company-limited" target="_blank" data-smartkarma-citation="entities:26038:1" rel="noopener">Gulf Energy Development Public Company (GULF TB)</a> making an early grab ahead of its EGM?</p>
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<div>
<p>Preceding my comments on Intouch are the weekly setup/unwind tables for Asia-Pacific Holdcos.</p>
</div>
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<p>These relationships trade with a minimum liquidity threshold of US$1mn on a 90-day moving average, and a % market capitalisation threshold - the $ value of the holding/opco held, over the parent’s market capitalisation, expressed in percent - of at least 20%.</p>
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This week in StubWorld ...



Last Friday, 160mn shares of Intouch Holdings (INTUCH TB) - a 4.99% stake - traded after the close at Bt64.86/share. Investors de-risking? Temasek exiting (or adding)? Or Gulf Energy Development Public Company (GULF TB) making an early grab ahead of its EGM?



Preceding my comments on Intouch are the weekly setup/unwind tables for Asia-Pacific Holdcos.



These relationships trade with a minimum liquidity threshold of US$1mn on a 90-day moving average, and a % market capitalisation threshold - the $ value of the holding/opco held, over the parent’s market capitalisation, expressed in percent - of at least 20%.


<p><a href="https://www.smartkarma.com/entities/telekomunikasi-indonesia" target="_blank" data-smartkarma-citation="entities:1051:1" rel="noopener">Telekomunikasi Indonesia (TLKM IJ)</a> reported FY2020 results recently, which continued to reflect the company's ongoing digital transformation and increasing importance as a proxy for Indonesia's booming digital economy, with Telkomsel's digital business increasing its contribution to 71.6% of sales in FY2020 versus 63.9% in FY2019. </p>
<p>The company's broadband service Indihome also continues to show strong performance, with revenue up by +21.2% driven by strong growth in subscribers and improving ARPU.</p>
<p>The enterprise segment also showed surprisingly strong growth during the year but especially in 4Q2020, where it saw revenue growth of +67.9% YoY driven by data centres.</p>
<p>Telkomsel deployed a further 27,700 new towers in FY2020, bringing the total to 231,200 BTS towers and it continues to transfer towers to Mitratel.</p>
<p><a href="https://www.smartkarma.com/entities/telekomunikasi-indonesia" target="_blank" data-smartkarma-citation="entities:1051:1" rel="noopener">Telekomunikasi Indonesia (TLKM IJ)</a> recently further increased its investment into <a href="https://www.smartkarma.com/entities/gojek" target="_blank" data-smartkarma-citation="entities:25976:1" rel="noopener">Gojek</a> to US$450m signifying its commitment to the digital economy.</p>
<p><a href="https://www.smartkarma.com/entities/telekomunikasi-indonesia" target="_blank" data-smartkarma-citation="entities:1051:1" rel="noopener">Telekomunikasi Indonesia (TLKM IJ)</a> remains an increasingly interesting play on Indonesia's growing appetite for data and broadband services, as these areas take over as growth drivers for the company and the legacy voice and SMS businesses fade. The increasing exposure to digital services outside providing the network and data make it a potential candidate for a digital re-rating. The company trades on 5.6x FY2021E EV/EBITDA and 4.8x FY22E EV/EBITDA versus the 5-year average of 6.2x forward EV/EBITDA, making it attractive even without any re-rating.</p>
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Telekomunikasi Indonesia (TLKM IJ) reported FY2020 results recently, which continued to reflect the company's ongoing digital transformation and increasing importance as a proxy for Indonesia's booming digital economy, with Telkomsel's digital business increasing its contribution to 71.6% of sales in FY2020 versus 63.9% in FY2019. 
The company's broadband service Indihome also continues to show strong performance, with revenue up by +21.2% driven by strong growth in subscribers and improving ARPU.
The enterprise segment also showed surprisingly strong growth during the year but especially in 4Q2020, where it saw revenue growth of +67.9% YoY driven by data centres.
Telkomsel deployed a further 27,700 new towers in FY2020, bringing the total to 231,200 BTS towers and it continues to transfer towers to Mitratel.
Telekomunikasi Indonesia (TLKM IJ) recently further increased its investment into Gojek to US$450m signifying its commitment to the digital economy.
Telekomunikasi Indonesia (TLKM IJ) remains an increasingly interesting play on Indonesia's growing appetite for data and broadband services, as these areas take over as growth drivers for the company and the legacy voice and SMS businesses fade. The increasing exposure to digital services outside providing the network and data make it a potential candidate for a digital re-rating. The company trades on 5.6x FY2021E EV/EBITDA and 4.8x FY22E EV/EBITDA versus the 5-year average of 6.2x forward EV/EBITDA, making it attractive even without any re-rating.




Telkom Indonesia (TLKM IJ) - Digital Catalysts Abound?

Thailand

Intouch Holdings Public Company Limited is a holding company that invests in diversified telecommunication and media and advertising businesses.  The Company, through its subsidiaries, provides television broadcasting, cellular phone and wireless services.

Total Access Communication Public Company Limited provides cellular mobile telephone services under WorldPhone 800 and WorldPhone 1800 brand names throughout Thailand. The Company also sells cellular handsets and other telecommunications equipment through its WorldMedia network of retail stores.

True Corporation PCL is an integrated telecommunications provider. The Company offers a wide range of voice, video, and data services, including dial-up and broadband Internet services, pay television, fixed-line phone, online games, and mobile phone services.

Jasmine International Public Company Limited provides telecommunication services including fixed-telephone lines, wireless network, digital network and internet access services. The Company also distributes telecommunication equipment through its own retail chain stores.

Thaicom PCL operates satellite communication business. The Company operates and provides satellite transponder services. Thaicom also provides Internet, satellite uplink/downlink, and telephone network services.

Digital Telecommunications Infrastructure Fund is a closed-ended fund that owns telecommunications towers and other related passive telecommunications infrastructure for mobile telecommunications services. Digital Telecommunication also owns core fiber optic cable grid and related transmission equipment and an up-country broadband system.

Digital Telecommunications Infrastructure Fund (DIF TB)

Digital Telecommunications Infrastructure Fund

Symphony Communication PCL provides Internet services. The Company provides Ethernet services throughout the Bangkok Metropolitan areas.

Samart Telcoms Public Company Limited provides satellite communication network services.  The Company's products and services include international video conferencing, Local Area Network (LAN), Wide Area Network (WAN) via satellite links, Electronic Data Interchange (EDI), and high speed corporate internet access.

China United Network Communications Limited provides a variety of telecommunication services, including GSM and CDMA wireless telecommunication services, international and domestic long distance communication services, data communication and Internet services, as well as paging services.

Rogers Communications, Inc. is a diversified Canadian communications and media company. The Company's activities include wireless voice and data communications services over its national GSM, HSPA and LTE networks; cable television, telephony and high speed Internet access services over its broadband networks; and radio and TV broadcasting, televised shopping, magazines, and sports.

Vodafone Group PLC is a mobile telecommunications company providing a range of services, including voice and data communications.  The Company operates in Continental Europe, the United Kingdom, the United States, Asia Pacific, Africa and the Middle East through its subsidiaries, associates, and investments.

Vodacom Group Limited operates a cellular telephone network in South Africa. The Company has mobile operations in Tanzania, Mozambique, Lesotho and the Democratic Republic of Congo.

CelcomDigi Berhad is a mobile network operator. The Company offers Internet and wireless telecommunication products and services through the global system for mobile telecommunications (GSM) network. CelcomDigi serves customers in Malaysia.

Taiwan Mobile Co., Ltd. provides cellular telecommunication services in Taiwan. The Company also sells and leases cellular phones.

Vodafone Idea Limited operates as a telecom service provider. The Company offers 2G, 3G, and 4G mobile services, as well as mobile payments, advanced enterprise offerings, and entertainment. Vodafone Idea serves customers in India.

Far EasTone Telecommunications Co., Ltd. provides mobile communication and Internet access services.  The Company also sells cellular phones and related equipment.

SK Telecom Co., Ltd. is a Korean mobile and telecommunications operator. The Company provides cellular voice, wireless data, and wireless internet services. SK Telecom also offers fixed line services and platform services.

Tele2 AB is a telecommunications company.  The Company offers mobile services, fixed broadband and telephony, data network services and content services. Tele2 operates throughout Europe and EuroAsia.

Advanced Info Service Public Company Limited is granted a 25-year concession expiring the year 2015 by the Telephone Organization of Thailand to provide cellular phone services.  The Company provides analog mobile phone services through the Nordic Mobile Telephone (NMT900) network, and digital phone services through the Global Systems for Mobile Communication (GSM) network.

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Advanced Info Service (ADVANC TB)

Last Week in Event SPACE: SOHO China, Toshiba, Boral Ltd, Yageo/Chilisin, Microstrategy

The weekend is here! Pour yourself a coffee, grab a comfortable seat, and sift through a brief summary of insights on various events discussed...

David Blennerhassett

StubWorld: Gulf's Curious Offer For Intouch Now Open

I would avoid Intouch here, but I would not short it. I think we have to wait until the close of the Offer to get a better idea of what Gulf's next...

David Blennerhassett

Telekomunikasi Indonesia (TLKM IJ) - The Trend Is Digital

Telkom Indonesia's recent 1Q2021 results reflect a competitive environment but also its growing strength in its digital business, which continues...

Angus Mackintosh

Telkom Indonesia (TLKM IJ) - Digital Catalysts Abound?

Telkom Indonesia is increasingly exposed to the digital economy, not just through data and network but through digital mobile services, fixed...

Angus Mackintosh

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52-week Range

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Last Week in Event SPACE: SOHO China, Toshiba, Boral Ltd, Yageo/Chilisin, Microstrategy

The weekend is here! Pour yourself a coffee, grab a comfortable seat, and sift through a brief summary of insights on various events discussed...

David Blennerhassett

StubWorld: Gulf's Curious Offer For Intouch Now Open

I would avoid Intouch here, but I would not short it. I think we have to wait until the close of the Offer to get a better idea of what Gulf's next...

David Blennerhassett

Telekomunikasi Indonesia (TLKM IJ) - The Trend Is Digital

Telkom Indonesia's recent 1Q2021 results reflect a competitive environment but also its growing strength in its digital business, which continues...

Angus Mackintosh

StubWorld: Intouch's Big Share Transfer

The vote and the waiver are a formality. Trading super tight at 1.2%/4.4% gross/annualised. I'd avoid the arb here and wait for any weakness...

David Blennerhassett

Telkom Indonesia (TLKM IJ) - Digital Catalysts Abound?

Telkom Indonesia is increasingly exposed to the digital economy, not just through data and network but through digital mobile services, fixed...

Angus Mackintosh