Pathetic QR-ly results. Earnings are lower Q-o-Q and Y-o-Y by double figures. DPS is even worse. Need to go back to almost 10 years (2013) to find a lower dividend and that's not accounting for inflation. Unfortunately, there is no where end in sight. Currently, Digi is the worst performing stock in my portfolio this year.
Let's make Digi the next meme stock like GameStop and AMC. It seems that the drastic fall in prices is due to large disposal of shares by EPF over the month in the big 4 telcos. It's likely to be a move of retaliation for not being able to reach an agreement with the allocated shares under DNB.
In my opinion, the Big 4 are better off deploying their own 5G.
With the current DNB's offer, it doesn't make business sense in terms of cost. Not to mention after the contract ended, the infra is not even belonged to you but to DNB.
While it's good to have more competitors in the industry to avoid monopolization. With our current demographic, I don't think we have any monopolization risk at the moment. In fact, the competition in the telco industry is just the right mix. - Not too many competitors where the price will go down, but service will follow suit as the companies would only focus on a price battle then we get poor coverage and slow service. - We have a Big 4 that complements and keep each other in check with smaller companies picking up the pace or these small companies may eventually join up and form the Big 5.
The current government is just too hard-headed/ego to realize without the Big 4, the 5G deployment will just be slow.
It makes NO sense to add more players in the current situation if what you want is to speed up the 5G deployment in the country, it could be a win-win situation but it is not. It's the same as you hiring someone to do a job, you can't pay a fresh-grad rate to an employee with 5 or 10 years experience, ain't you?
Well unless they doing that for some cronies, then that's a different case.
COMMENT | When the second and third largest telecommunications companies (telcos) in the country team up to become the largest and virtually all of the mobile business is eventually concentrated in the hands of just two companies, it should set off alarm bells ringing.
But instead, the regulator, Malaysian Communications and Multimedia Commission (MCMC), has given Celcom Axiata Bhd and Digi.com Bhd, controlled respectively by Malaysia’s Axiata Group and Norway’s Telenor, to go ahead with their merger, subject to some inconsequential conditions.
That will make the merged company the largest telco in Malaysia, eclipsing the current largest Maxis Bhd and reduce further competition in the telecommunications area where Malaysia already has some of the highest rates for both broadband and mobile services, the key components of telecommunications.
Allowing a further concentration of pricing power in an area where it is already controlled almost cartel-like in the mobile area by the three major telcos mentioned is a travesty and will ensure that the consumer continues to get the wrong end of the stick in the deal. There are two things that give rise to such poor decisions. First, large companies in this country have a huge influence on the government which effectively controls regulation in many areas - telcos, banks and insurance, airlines, manufacturing, industry, etc. So the government’s influence is disproportionately large because regulators are appointed by the government.
Second, while there are commissions to control various business sectors, they are often not independent and some of them may not be competent enough to deal with all the issues involved.
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