Top-ups for prepaid mobile services will be subject to GST upon activation, the Communication and Multimedia Consumer Forum (CFM) declared yesterday, after a meeting between the consumer forum and the Customs Department to seek clarity on the implementation of GST on prepaid services. CFM added that as a transitional measure, the telcos would provide customers who reload RM5 and above, a value which is higher than the GST addition in the form of free minutes and SMS, for a period of 3 months. (Source: The Edge Daily)
Separately, Communications and Multimedia Minister Datuk Seri Ahmad Shabery Cheek said that there would be an announcement on lower broadband rates this month, which is expected to decline by more than 6%. (Source: The Star)
Comments: This should finally resolve the confusion among the telcos on GST implementation on the prepaid segment and paving the way for the telcos to pass on the “tax element” to the consumer instead of absorbing it previously. Near term however, with the increased freebies given, any positive impact should be muted. Beyond the 3 months , and depending on demand elasticity, it remains to be seen whether demand will remain strong with the higher prices. The lower broadband rates should however mitigate some of this effect and hence keep demand for telco services firm. Maintain Neutral on the sector with DiGi (BUY; TP: RM7.05) as our top pick.
Source: Affin Hwang Capital Research - 3 Apr 2015
Chart | Stock Name | Last | Change | Volume |
---|
2024-08-09
CDB2024-08-07
CDB2024-08-07
CDB2024-08-06
CDB2024-08-05
CDB2024-08-05
CDB2024-08-02
CDB2024-08-02
CDB2024-08-01
CDB2024-08-01
CDB2024-08-01
CDB2024-08-01
CDB2024-08-01
CDB2024-08-01
CDB2024-08-01
CDB2024-08-01
CDB2024-07-31
CDB2024-07-31
CDB2024-07-31
CDB2024-07-31
CDB2024-07-30
CDB2024-07-30
CDB2024-07-30
CDB2024-07-29
CDB2024-07-29
CDBCreated by kltrader | Jan 03, 2023
Created by kltrader | Sep 30, 2022