Still a ‘hold’ call on Astro

PETALING JAYA: AmInvestment Bank Research maintained a “hold” call on Astro Malaysia Holdings Bhd, in the wake of the government announcing that it is open to more entrants into the paid television broadcasting services scene, on the belief that the competitive landscape is unlikely to change and Astro continuing to broadcast on a non-exclusive basis.

Deputy Minister Eddin Syazlee Shith told Dewan Negara recently that the ministry was ready to grant Content Application Service Provider (CASP) individual licences to interested companies, subject to certain conditions such companies being incorporated in Malaysia with a paid-up capital of RM500,000.

Maintaining the “hold” call at RM1.81 per share, the research house said there is unlikely to be a significant change in competitive landscape as Astro’s exclusive rights and privileges to broadcast live content through satellite services to the public since 1997, expired on Feb 28, 2017.

Following the expiration, Astro will still be able to broadcast via satellite on a nonexclusive basis as its licence under the Communications and Multimedia Act 1998 is valid until Feb 1, 2020.

As at June 30, 2018, the total companies which holds the CASP licence stood at 56, among which four – namely Ansa Broadcast Sdn Bhd, Jaringan Mega Sdn Bhd, Smart Digital International Sdn Bhd, and High End Net Sdn Bhd – were allowed to broadcast services via satellite, while 35 companies held licences to offer broadcasting services through various platforms.

“Astro’s household penetration rate stood at 75% for its residential Pay-TV and NJOI customers in 1QFY19. We believe this indicates that the Pay-TV segment is saturated and will continue its declining trend as consumers’ preferences shift towards streaming content through digital and overthe-top platform,” the research house noted.