AmInvestment maintains ‘buy’ call on Axiata with RM4.90 fair value

Axiata and the group’s wholly-owned Celcom Axiata together with edotco Group and Axiata Digital have launched a RM150 million fund for micro small-medium enterprises (SMEs) as part of their Covid-19 assistance programme, supported by an initial RM20 million contribution from the Ministry of Finance. — Reuters pic
Axiata and the group’s wholly-owned Celcom Axiata together with edotco Group and Axiata Digital have launched a RM150 million fund for micro small-medium enterprises (SMEs) as part of their Covid-19 assistance programme, supported by an initial RM20 million contribution from the Ministry of Finance. — Reuters pic

KUALA LUMPUR, March 27 — AmInvestment Bank Bhd has maintained its ‘buy’ call on Axiata Group Bhd with unchanged forecasts and sum-of-parts-based fair value of RM4.90 per share.

Axiata and the group’s wholly-owned Celcom Axiata together with edotco Group and Axiata Digital have launched a RM150 million fund for micro small-medium enterprises (SMEs) as part of their Covid-19 assistance programme, supported by an initial RM20 million contribution from the Ministry of Finance.

In a note, AmInvestment Bank said as the sums involved account for less than one per cent of Axiata’s market capitalisation.

This development, partly funded by the government, would not have any substantive impact on the group’s earnings nor gearing.

“Furthermore, the micro-financing programme, which is not a donation, involves delayed repayments with profit-sharing terms. We view this mildly positive initiative as part of the group’s efforts to capitalise on the current situation to boost Axiata Digital’s micro-credit and e-wallet operations, which have yet to be profitable at this stage,” it said.

On the Covid-19 assistance programme, Axiata Digital would offer syariah-compliant micro-financing on its Aspirasi digital platform in the range of RM1,000 to RM10,000 on favourable terms such as suspended repayment requirements and concessional interest rates to reach an estimated 150,000 micro-SMEs within Boost, Aspirasi and the Celcom ecosystem, together with its e-commerce and other telcos/e-wallets.

Additionally, the programme would also bundle micro-insurance coverage under Aspirasi to protect micro-SME proprietors and merchants with emergency income, accidental death and Covid-19 assistance. — Bernama

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