HwangDBS Vickers Research Sdn Bhd is projecting Axiata Group Bhd’s revenue for financial year 2011 to grow by 10 per cent while the earnings before interest, taxes, depreciation and amortisation (EBITDA) margin will remain stable at 49 per cent.
This is premised on Axiata’s 2011 plan to grow its revenue from Robi in Bangladesh, Dialog in Sri Lanka, XL in Indonesia and Celcom in Malaysia.
Except for Dialog, the other subsidiaries are targeted to perform ahead of the industry.
While Celcom and XL will continue to grow mobile data services while remaining cost efficient,Robi will work to improve service quality and offerings.
Meanwhile, Dialog will focus on growing its data services revenue and managing cost efficiencies added HwangDBS.
As for dividend payout, it is projected that hte level would be 35 percent as Axiata will be able to pay more dividends, given an expected more than sufficient free cash flows over the next two to three years.
Axiata has a dividend policy of a minimum 30 per cent payout ratio, translating to about a two per cent yield.
HwangDBS has maintained a “buy” call on Axiata with a sum-of-parts (SOP) derived target price of RM5.60.
It's about 90 sen from that point. I will buy now and leave at RM5.30
