There were rising competitive risks and special dividends being a tall order.
Concerns are pointed to increasingly aggressive MAXIS Bhd, which has just launched its new Hotlink plan and cut IDD rates in an effort to arrest its decline in market share.
DIGI also said special dividends will be a challenge for now (March 2012) as the rm692 million share premium reserve at the holding company cannot be utilized since the cash can only come from its operating subsidiary, DIGITEL, from which proceeds are upstreamed through retained earnings to pay dividends.
Market observers see the downside risks to DIGI’s earnings arising from the more aggressive MAXIS as it has more to lose in the segments that MAXIS is apparently targeting – migrant workers and value conscious customers. MAXIS
MAXIS had earlier said it is prepare to do anything to win back customers and restore its market share, which has been chipped away by DIGI, Celcom and to a lesser extent, U Mobile and Tune Talk. Also there are marketing Lethargy with regards to DIGI’s acquisition and retention campaigns, which is departure from the past when its was a nimble operator and typically led the market.
The company said it will monitor the competitive response before making any decision to retaliate as MAXIS’ packages and tariff adjustments were merely a normalization of its legacy packages, which were priced out of the market.
MAXIS said it can turn on LTE by 4QFY2012 should the company be awarded the 2.6Hz spectrum by the middle of 2012. However, it does not intend to be aggressive with the rollout as LTE devices are still lacking.
Its capex for FY2012 stood at rm700 million to rm750 million. Its network modernization exercise is slated for completion by end 2012.
Concerns are pointed to increasingly aggressive MAXIS Bhd, which has just launched its new Hotlink plan and cut IDD rates in an effort to arrest its decline in market share.
DIGI also said special dividends will be a challenge for now (March 2012) as the rm692 million share premium reserve at the holding company cannot be utilized since the cash can only come from its operating subsidiary, DIGITEL, from which proceeds are upstreamed through retained earnings to pay dividends.
Market observers see the downside risks to DIGI’s earnings arising from the more aggressive MAXIS as it has more to lose in the segments that MAXIS is apparently targeting – migrant workers and value conscious customers. MAXIS
MAXIS had earlier said it is prepare to do anything to win back customers and restore its market share, which has been chipped away by DIGI, Celcom and to a lesser extent, U Mobile and Tune Talk. Also there are marketing Lethargy with regards to DIGI’s acquisition and retention campaigns, which is departure from the past when its was a nimble operator and typically led the market.
The company said it will monitor the competitive response before making any decision to retaliate as MAXIS’ packages and tariff adjustments were merely a normalization of its legacy packages, which were priced out of the market.
MAXIS said it can turn on LTE by 4QFY2012 should the company be awarded the 2.6Hz spectrum by the middle of 2012. However, it does not intend to be aggressive with the rollout as LTE devices are still lacking.
Its capex for FY2012 stood at rm700 million to rm750 million. Its network modernization exercise is slated for completion by end 2012.
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