I've attend Redtone's AGM yesterday morning and felt happy with all the informations provided by Group CEO Mr.Lau Bik Soon.

Mr.Lau is a nice guy,he spend about 30 minutes during AGM to explain and share outlook of all the three businesses,included telecommunication business(TS),manage telco network services(MTNS) and industry digital services(IDS).

Even after AGM,He also willing to spend another 45 minute to patiently answer additional questions raise by a group of young shareholders.

The information share by Mr.Lau was summarize as below:

1.)MTNS business prospect is exciting due to RM21.6billion NFCP plan

●NFCP involved huge investment from Telco and MCMC to build more infrastructure,outlook for MTNS is very exciting as the business segment servicing both telco and government.

●TIME 3 project,which is funded by universal service provision(USP) fund managed by MCMC,had continue to extent but changed name to NFCP2.The NFCP2 already in tender now and the result should be announce sometime next year.

●latest NFCP2 tender will involved 500 new telco sites.(abount 40% increase if compare to 360 sites under previous TIME 3 contract.)

●Expect NFCP roll out constantly starting next year.

●5G cell is smaller,thus need more infrastructure to support,that is good to redtone.

●After finish installation work(one-off income),Redtone will continue to do maintainance work for the towers owner(recurring income),that means recurring income will increase over time with more and more tower roll out.(This is a positive surprise because previously i thought MTNS business do not have any recurring income.)

●Redtone do not build the whole tower,but only handle electronic portion.

●MTNS already build up around RM50 million regular revenue so far.

●Redtone had participated MCMC's Rural projects for years,now already became the biggest MTNS player in east malaysia,one of the focus area under NFCP as sabah and sarawak still largely underserve.

●Other than MCMC,MTNS division also servicing big telco like maxis and umobile.

●Telcos buy necessary electronic equipment from supplier like huawei or sony ericsson,then ask redtone to install and maintain towers on behalf of them.

2.)Telecommunication Services(TS) business will benefited from 5G in longer term

●The business will remain stable as all the income was on regular basis and contributed by more than 15,000 diverse customers from different industry.

●5G is definitely positive to TS business,but the impact will only be felt in longer term,immediate beneficial will still be MTNS business as infra need to be built first before 5G roll out.

●Currently,mainly offer fixed line solution to customers due to limitation in mobile transmission,but 5G able to solve the current issue,thus provide another option to customers will become possible in the future,thats means more business opportunity.

3.)IDS business have great potential to grow

●Few business activities under IDS division

●Flexi-craft provide virtual reality(VR)solution to customer,mainly for marketing purposes,can be use in various industry like hotel,property,education,retail,etc.

●Not many website positioned with VR experience yet,very young and new market,expect to grow fast in years to come.

●Smart farming solution business progress well as more farmers realised the benefit of smart farming.

●Based on implementation result so far,smart farming solution is pratically useful in reducing cost and increase crops productivity,provide farmers with double benefit.

●IDS is complemented to TS and MTNS business,as redtone not only provided solution but also provide line,cyber security and data center service,thus very competitive.

●On track to break even by this financial year(FY 2020).

Other important point:

●Some shareholders raise queation about the implication of U mobile listing and even potential back door listing,Mr.Lau admitted there are many synergy between Redtone and U Mobile business,as Redtone is servicing corporate customers and involved in MTNS business,on other hand U mobile is servicing retail customers and need to invest in telco towers.

●The board will look into any business opportunity between two company as long as can enhance shareholders value.

●Currently,Redtone did provide indirect services to U Mobile,but intent to deal directly with U Mobile in the future.

●About the potential main board listing,Mr.Lau said he understand the difficulty face by investors(as a shareholder claim margin rules set by investment bank is not friendly to ace market company),and will definitely look into any opportunity to enhance shareholder value.

●One of the shareholders asked since the NFCP and 5G might create much more work order to Redtone,is right issue a possible option since company might need more fund to fufill order?Mr.Lau replied Redtone business is on light capital model,no need huge capital to excecute order,furthermore Redtone is almost zero debt and constantly sitting on RM60-70million net cash,so is well prepared to any opportunity.

●Lastly,Mr.Lau clarify that RedONE is not owned nor had any relationship with Redtone,many had misunderstood because the name and logo design of the two company is similar,but in fact Redtone had no relationship with RedONE at all.(I am glad to heard this since small telco provider like RedONE hard to compete with big boy like maxis celcom or digi.)

Conclusion:

I walk out from AGM with confident after knowing more about Redtone,a good company lead by good management team,i'll said it might be the multibagger company to invest for the next 2-3 year as the industry will be booming soon with NFCP and 5G roll out.

All the three businesses had great potential for growth,the earning already on growing trend and should continue to grow in years to come,i am expecting Redtone to break record again and again in years to come.

The only thing that make me sad,was actually don't have much money left in my share account,cant buy more share even Redtone is selling cheap at below 50 cen now.I wish i could buy all the shares below 50 cen,i really do.

Just too bad i am not clever enough to establish IJM back to 50 years ago,ishhhh(*o*)