Although TdC's revenue disappoints street's estimate, FY11 core net profit of RM93.5m (ex-exceptional gain of RM20.8m) came within expectations,accounting for 95% of our full-year forecast and 86% of consensus.

Adjustments made amounting to RM22.9m (RM19.7m in 3Q11 and RM3.2m in 4Q11) for expenses recognized previously for certain projects and service contracts. The adjustments made resulted in a one-time reduction of operating expenses in the current quarter.

Recognition of impairment loss on a freehold land amounting to RM2.1m.

Continuous data momentum: revenue elevated by 26% yoy and 11% qoq, while FY11 increased 20% yoy.

Voice down trending, but stabilizing: revenue +4% yoy but zero growth qoq. while FY11results was stable.

Maintain our BUY call with unchanged SOP target price of RM0.85. If DiGi current share price is considered rather than our TP, SOP would be enhanced by 9 sen.

Source: HLB Research 24 Feb 2012