what do u guy think of digi in future? is it a defensive stock?

Sterling second quarter for DiGi

It remains the preferred telecoms pick of research houses

PETALING JAYA: DiGi.Com Bhd, which announced another set of sterling results yesterday, remains the “preferred’’ telecoms pick of some research houses as it offers greater upside than the other two listed telcos, Telekom Malaysia Bhd ™ and TM International Bhd (TMI).

An analyst in his recent sector update maintained a “neutral” call on the sector as it offered defensive earnings amid an uncertain economic backdrop.

Affin Investment Bank said the cellular sector would continue to grow but the residential fixed line market would see a margin erosion. “We advocate avoiding the fixed line segment altogether.

We see increasing risk not only from lower tariffs but also intensifying residential fixed line drop-outs as alternative broadband solutions materialise,” it said.

To support its argument that the fixed line business would be flat, the report cited the experience of several regional operators such as KT Corp, China Netcom, Chunghwa and China Telecom.

Fixed line revenues of these players were flat or declining, but this was being compensated by other revenue streams, including wireless services. In TM’s case, however, it has transferred its cellular assets to TMI.

The revenues of these companies were flat in recent years and “TM will likely share a similar fate,’’ it said.

Even Ericsson, the world’s largest maker of wireless networks, expects demand for wireless and fixed line telephone networks to remain flattish this year. This means that operators are not buying equipment for fixed line expansion.

Ericsson yesterday announced a 70% drop in its second quarter profit due to factors such as lower demand for phones (See page 10).

As for TMI, the analyst cautioned about TMI’s regional operations, particularly in politically unstable countries such as Sri Lanka and Bangladesh, as growth had been crimped.

Overpaying for regional expansion had also not gone down well, especially its recent acquisition of a 19% stake in Idea Cellular.

“We keep our 'reduce' rating on TMI as we see Celcom’s market share, and hence earnings, being threatened by DiGi,” the report said.

“For exposure, we like DiGi which we anticipate will continue to build its market share at the expense of its peers, post the launch of its broadband services.

“Underpinned by strong management, improving network coverage, quality and branding, DiGi is expected to record a decent earnings growth of 13% for financial year 2008. Likewise, dividend yields are above market average at 5.6%,” Affin said.

There is talk that the implementation of mobile number portability (MNP) may be further delayed. Nonetheless, it felt that DiGi would still be the winner in an MNP environment.

DiGi reported a 19% rise in net profit to RM298mil for the quarter ended June 30 from a year earlier. Revenue rose from RM1.05bil to RM1.19bil. Earnings per share was higher at 38.9 sen from 33.4 sen before.

For the first six months, net profit was up 18% to RM588mil from RM496mil previously. Revenue increased 14% from RM2.07bil to RM2.36bil.

DiGi said the higher earnings were led by higher traffic following the introduction of innovative services and offerings. It declared an interim dividend of 57 sen.

URL: http://biz.thestar.com.my/news/story.asp?f...86&sec=business

Digi is the best telecommunication company in Malaysia, absolutely remarkable business model. Not only it has the cheapest rate for international calls, but also one of the most innovative prepaid plans ever compare to Hotlink and Xpak.

One of the best defensive stock in Malaysia.

well by end of the year digi will come out with its 3g
so they will have a great fight with better 3g service

i am interested on Digi's high dividend each year. But hope to buy it at low price....pls advise lowest price i can get in.

Digi closed at 23.90 today. With dividend of RM 2.00++ last year. I think this price is quite reasonable. Nobody know the lowest price. I think digi profit will not affected much by the current market as it is not political link. Every body still have to make calls no matters how high the crude oil rise. It is one of the top pick at current market i think. If for me i will wait till it drops to RM 20.00 which give you some margin of safety.

Sorry, you won't get the answer for this kind question, one only knew it is lowest when it is too late.

I'll take out my crystal ball and try to get the answer for this one.

Lowest price <RM25. So buy now, don't wait

Based on its stocks, i think a price of 23.50 is good to enter, anyway it looks like it is starting climbing

Haha...now DIGI at 18.90 and as low as 18.60....
So what is the main trigger on the drastic drop.....

Any one already take the position in the stock....

So is this a good time to bargain hunting ?

Or are you catching falling knife??

go in..

wait...

htt..any internal news

It's open news le..this quarter profit lower than the same quarter last year. Next quarter also expected to be lower. So price may drop further.

It will happen to all sectors, shares will test new low in coming months...

PORTABILITY IS A MAJOR CONCERN. DIGI MAY LOSE THE WAR.

DiGi weighs funding needs

It is to part finance capex of RM1.3bil next year

DIGI.COM BHD will need to go to the debt market next year to get some funding for its capital expenditure of up to RM1.3bil next year, says chief executive officer Johan Dennelind.

URL: http://biz.thestar.com.my/news/story.asp?f...40&sec=business

CEO: Strong brand a big plus for DiGi

Excerpts from the interview with DiGi boss Johan Dennelind.

STARBIZ: The battle for customers is getting intense. Will the Yellow Man (DiGi icon) be able to withstand the pressure as well as retain and increase market share at a time when growth is slowing?

URL: http://biz.thestar.com.my/news/story.asp?f...80&sec=business

Digi's revenue has consistenly out performed her last previous quster. In term of evaluation, the present market value is fair. But in future, upon intro of 3G, the company strength is at par with other telco. Futhermore the swithing (MNP) provide great chance to seduce those 019 and 012 user to switch to them. If you are looking at the future, the profit might rise further and share price might go up somemore.

To get involved in 3G, Digi needs lot more Capex. It takes a couple of years to break even.

It is not so simple as expecting instant good return. In fact, at the initial , a big portion of 2G profit is to cover 3G losses.

It is always the opposite of what people think.