KUALA LUMPUR, March 2 ― Affin Hwang Capital has maintained its “buy” call on Astro Malaysia Holdings Bhd with a target price of RM3.35 following its strong positioning as the country's dominant Pay-TV operator.
Given its brand name, product proposition and sticky subscriber base, the research house expects Astro to continue to cement its position as Malaysia's dominant Pay-TV operator.
“While sentiment on Astro remains weak due to the emergence of online streaming operators such as Netflix and Iflix, we opine that the threat is minimal.
“The availability of quality online streaming experience remains contained within the urban/sub-urban vicinity due to the lack of higher speed broadband facility,” said Affin Hwang in a note today.
Astro's key differentiating point is its quality vernacular content which is not readily provided by other media players, which helps to create a sticky subscriber base, steadily increasing to a high of 4.7 million households as of the third quarter ended October 31, 2015.
Coupled with increasing average revenue per user (ARPU), Astro's revenue from television subscription should remain stable, said Affin Hwang.
“We also like Astro's timely move into the e-commerce segment through Go Shop, a home shopping channel,” it added.
At 11.37am, Astro gained two sen to RM2.74, with 646,000 shares transacted. ― Bernama