KUALA LUMPUR, May 28 — Telekom Malaysia Bhd (TM) emerged as one of the top gainers on Bursa Malaysia in the morning trade after recording solid results for the first quarter ended March 31, 2021 (Q1 FY2021).
At 10.15am, TM’s share jumped 33 sen, or 5.59 per cent, to RM6.23 from RM5.90 at Thursday’s close, with 3.86 million shares changing hands.
The telecommunications giant, in an exchange filing yesterday, said its net profit was more than doubled to RM325.47 million in Q1 FY2021 from RM152.52 million in Q1 FY2020, lifted by higher revenues across all of its segments apart from its other telecommunications services.
In a note today, Maybank Investment Bank Bhd Research said TM’s core net profit of RM332 million (up 38 per cent year-on-year) was 30 per cent of both the research house and consensus’ FY 2021 forecasts.
“The overall outlook remains favourable, with TM potentially benefitting from both the work-from-home and 5G-deployment themes, and ongoing cost optimisation.
“Hence, we reiterate ‘buy’ call with an unchanged target price of RM7.40,” it said in a note.
Similarly, MIDF Amanah Investment Bank Bhd Research (MIDF Research) has also maintained its “buy” recommendation on TM with an unchanged target price of RM6.91.
The research house was of the view that the MYDIGITAL initiatives would bode well for the group.
“Premised on this, we expect the group’s revenue growth in the coming years to remain intact. Moreover, we commend the group’s cost rationalisation programme which has significantly improved the group’s profitability,” it said in a separate note.
Meanwhile, Public Investment Bank Bhd upgraded its call on TM to “outperform” from “neutral”, with a higher target price of RM6.90 from RM6.60.
“Being the largest domestic data centre provider in Malaysia, we believe TM would benefit from higher data and internet consumption in the future, following the government’s plan to establish hyper-scale data centres under the MyDigital blueprint,” it said. — Bernama
