KUALA LUMPUR (Apr 16): CIMB IB Research has upgraded DiGi.Com Bhd to “Add” at RM4.48 with unchanged target price of RM5.10 and said DiGi’s 1Q18 EBITDA rose 1.3% quarter-on-quarter (q-o-q), but core EPS fell 5.8% qoq due to higher depreciation.
In a note April 14, the research house said results were in line with house expectations.
It said 1Q18 dividend per share at 4.9 sen implies 99% payout.
“Service revenue eased 2.0% qoq in 1Q18, but rose 0.7% yoy for the first time since 2Q15. Postpaid revenue growth continues to be robust.
“EBITDA margin rose qoq to 46.3% due to lower device, traffic and O&M costs.
“We forecast EBITDA to grow 2.6%/5.5%/4.0% yoy in FY18/19/20F on higher service revenue and improving margin.
“We upgrade from Hold to Add with an unchanged DCF-based target price of RM5.10,” it said.