firerain collection
The 1st RM250 million under NFCP ready to release,who will be the winner?
In Budget 2020,Finance Minister LGE announced that MCMC will allocate RM250 million to improve telecomunication connectivity in remote areas of malaysia,especially Sabah and Sarawak.
Do you ever wonder why RM250 million?
From what i understand, it is because MCMC already know what to spend,how to spend,and is ready to spend the 1st RM250 million under NFCP,so it is reasonable to assume the winner could be appear soon.
According to LGE,The RM250 million will be use to leverage on various technologies, including via satellite broadband,to improve connectivity in remote or rural area.
I found many people had confused by the word "satellite".
Satellite technology,when apply in telecommunication industry,means satellite will be use to send and receive signal instead of tower.But when in order to connect with satellite,Very Small Aperture Terminal or VSAT is needed,so you'll need someone expert in VSAT installation and integration work.
As far as i know,there are only two company in BURSA that owned the expertise.
1.)BINASAT
http://binacom.com.my/Satellite-Communication/
2.)REDTONE
https://www.redtone.com/telco-engineering-services/
So,if any listed company appear to be the winner of the 1st RM250 million allocation,i think most probably will be either BINASAT or REDTONE.(merely judging from public available data and fact,i dont know any insider information)
But when come to Shares INVESTMENT,Personally i prefer REDTONE due to strong financial result,strong balance sheet,and their long experience and advantage in serving rural areas.
In fact,no matter what technology is use to set up new telecommunication transmission spot,either is Fibre Optic,broadband,satellite ,microwave even WIFI,REDTONE is able to played a role since they are good in system integration and optimisation.No matter what technology applied,you will still need to install,integrate and optimise before running right?
Even REDTONE not able to grab any slice from the 1st RM250 million,it will be alright because current businesses of REDTONE still very profitable and financial result is on strong growing trend.
And do not forget,the RM21.6 billion NFCP was just started,even MCMC alone gonna spend RM10-11billion of UPS fund to increase internet coverage to 98% by 2023.
So,bigger contract should be release in months to come,and REDTONE will definitely one of the major winner,judging from their niche expertise and track record with MCMC.
So far,REDTONE had won 3 major contract from MCMC in last 7 year,which included RM82million in 2012,RM88million in 2014,and RM250 million in 2017.
I am looking forward to the 1st quarter result of REDTONE,which should be release by middle or end of next month(As REDTONE already change FY to 30/6),the figures should be fantastic one.
As i said before,FY 2020 should be a record breaking year given strong recovery of MTNS business and stable profit from TS business.The recent win of RM130 million medical related contract in sri lanka(this is indeed a big surprise and i din't expecting it) should also contribute positively to the bottom line from second half onward,the future is promising.
Bear in mind, i am talking about INVESTMENT,not SPECULATION.You want finest fruits,you take longer wait.
Stay tuned.
Disclaimer:
The analysis above is the result of my hard work,i’ve spend so many time in research and study.However,i might be right or wrong,i advise you to do your own study before making any buy or sell decision since you might come out with different opinion or conclusion,and you are fully responsible for all the risk and reward yourself.Thank you.
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2 people like this. Showing 6 of 6 comments
250 million will be 1st allocation only,more are coming,since the total amount which will be spend by MCMC estimated around RM10-11 billion.
2019-10-25 02:21
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