TM’s convergence strategy to eventually lead path towards sector consolidation

K UCH I N G : Ana ly s t s are continuing to expect Telekom Malaysia Bhd’s ( TM) convergence strategy to eventually lead the path towards sector consolidation.

Despite former TM managing director/chief executive officer (CEO) Datuk Seri Mohammed Shazalli Ramly’s resignation on Wednesday, AmInvestment Bank Bhd ( AmInvestment Bank) sti ll expected the group’s co nv e r g e n c e strategy to offer quad- play services to eventually lead the path towards sector consolidation.

The research firm said that this was because the need for a potent ial re- merger with Axiata Group Bhd is reaccentuated by TM’s weak first quarter of financial year 2018 (1QFY18) results.

According to AmInvestment Bank, TM’s acting group CEO Datuk Bazlan Osman, who assumed the role effective Wednesday, af f irmed in a recent teleconference that Shazalli’s resignation that day was due to personal reasons and was not under any investigation.

“Bazlan, who reaff irmed TM’s convergence drive to expedite the provision of quadplay services by continuing with the group’s strategic and business objectives, has been with TM as its group CFO since 2005, after becoming Celcom Axiata Bhd’s CFO in 2002,” the research firm said.

“He had earl ier joined Celcom Axiata in 2001 as the senior vice president (SVP), corporate finance and Treasury.”

AmI nve s tment Ba n k recal led that recruitment rates for new unifi customers continue to grow, rising five per cent quarter on quarter (q- o- q) and 20 per cent year on year ( y- o-y) to 1.2 million in 1QFY18.

“However, Streamyx shrank by six per cent q- o- q and 19 per cent y- o-y to 1.1 million due to migration to unifi and other fixed and wireless broadband providers.

“Meanwhile, unifi average revenue per users (ARPUs) slid sequentially by RM3 per month q- o- q to RM194 per month as TM positions to accommodate the government’s drive to ‘double the speed for half the price’.”