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PETALING JAYA: Maxis Bhd seems to be back on a growth trajectory for service revenues and net profit, while capital expenditure (capex) is expected at low levels pending clarity on its 5G rollout plans.
CGS International (CGSI) Research believes Maxis has several options for providing 5G services but a decision may take time due to its complexity.
Following Maxis’ fourth quarter of 2024 (4Q24) results, CGSI Research raised its financial year 2025 (FY25) to FY26 core net profit estimates by 6.3% and 5.4%, alongside an upward revision in service revenue projections.
For FY24 to FY27, CGSI Research expects service revenue compounded annual growth rate (CAGR) of 2%, which will in turn support a 3.4% core net profit CAGR over the same period.
The research house deferred its capex estimates, expecting muted spending until Maxis establishes a clear 5G rollout strategy, in line with its “less than RM1bil” FY25 capex guidance.
It reiterated its “add” call on Maxis with a higher price target of RM3.93 a share on the back of tweaks to its forecasts. At last look, Maxis’ share price was at RM3.19. The stock has declined 55.8% (versus the FBM KLCI’s down 15.9%) over the last 10 years, the research house said.
"- *Two weeks after soft guidance by Harta’s management* in its results briefing, *Malaysian glove companies ??* have seen share price declining by 30-40%.
- *Full impact from US order shifts are not reflected yet??.* Sept-Dec 24 (4Q24) results are already commendable, but note that US distributors frontloaded purchase from China producers...
- *Against 1Q25's softening results?,* 2Q25 will see good pick up as US' purchase recover ...
• *Malaysia production capacity is c.150b ?* (big 4 glovemakers) and running at *U-rate of c.60%* averagely...
- *Challenging outlook in Europe is not something new...
• *China ASP not as low as expected ...
• *Recall that China glovemakers only turnaround into operational profit in 1Q-2Q24...
- *Local glovemakers' global market share?* for medical gloves is highest at *c.40-55%..."
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In some regions of China, EV ownership surpasses ICE vehicles, and there are twice as many charging stations, five times more compared to Malaysia. However, here's the real issue: as more people switch to EVs, the demand for charging skyrockets.
During Chinese New Year, people start queuing from 5 a.m. to 8 p.m. for chargers, and some even display "out of service." You really want all people to use EV in Malaysia? are you ready?
