RedTone

Tan Sri Syed Mokhtar has been named the successful bidder by the MCMC to build, operate and manage the infra for the DTTB service in Malaysia. It beat Redtone and i-Media. The concession is for a period of 15 years.

While the news appears to be unfavorable to Redtone, the group could be better off by not securing the DTTB contract given that some of the key criteria have come in at the lower end.

Full roll out of the DTTB service is projected to be in the third quarter of 2014 in few test areas and full nationwide coverage is only expected to be completed by 2017.

Meanwhile the government was quoted as saying that it will only end its analogue TV broadcast services by 2020. The successful bidder can only commence billing charges after the ASO, thus making the return on investment a big challenge.

Following the renewed approval from its shareholders, Redtone started to execute its share buyback account to re accumulate its shares since Nov 2013. The group has, thus accumulated a total of 1.67 million shares with an estimated average price of rm0.67 per share as of Jan 9 2014.

It is confident of achieving 50% quarter on quarter growth in profit before tax for the second quarter ended Nov 30 2013 of FY2014, underpinned by the healthy growth of its core businesses, ongoing various synergic benefits created under the network sharing and alliance agreement with MAXIS Bhd.