KUALA LUMPUR, April 25 — RHB Investment Bank Bhd has maintained its Neutral rating on the telecommunications sector following the well executed targets of the Jalinan Digital Negara (Jendela) initiative in the first quarter of 2022 (Q1 2022) by the Malaysian Communications and Multimedia Commission (MCMC).

In a note, it said mobile network operators (MNOs) should be able to attain the 4G population coverage target by end-2022 at 96.9 per cent after Q1 recorded 95.52 per cent achievement.

At its quarterly briefing, regulator MCMC highlighted that the number of fibre installations completed during the quarter was 179,666, or 6 per cent ahead of the 170,017 target. As such, the 7.5 million premises initially targeted by year-end should be achieved by mid-2022, the research house said.

"The number of fibre premises passed and mobile broadband speeds were ahead of the targets set under the Jendela programme.

"We maintain our sector recommendation with preference for fixed line plays. The key risks are competition, weaker than expected results and regulatory setbacks,” it said.

The bank research said MCMC has indicated that discussions are ongoing between the MNOs and Digital Nasional Bhd (DNB) on the 5G reference access offer (RAO) document published in early April.

"The RAO (a legal document) forms the basis for MNOs to enter into binding 5G wholesale access agreements with DNB.

"The MCMC said discussions on the sale of up to a 70 per cent stake in DNB are running concurrently, with the aim to complete all discussions by the end of June,” it added. — Bernama