报告名称：Service Advanced Info：Capex of Bt40bn earmarked for 3G 4G network expansion
报告类型：海外市场
报告日期：2016-01-27
研究机构：辉立证券
页数：7
简介：Capex of Bt40bn earmarked for 3G and 4G network expansion in 2016
ADVANC as the country’s leading mobile network provider, officially launched its 4G serviceson January 26 after the company won a bidding license for 1800MHz spectrum last year.During the first 60 days after the winning on November 25, ADVANC added 7,000 basestations, covering 42 provinces, while the company has a plan to increase base stations to14,000 within the next four months to extend its coverage nationwide. As such, ADVAN hasearmarked capex of Bt20bn for 4G network expansion.
ADVANC created a campaign, entitled New World New Experience, to offer its customers 4Gexperiences. Under the campaign, the company has focused on:
1) Network: ADVANC has implemented 4G‐LTE advanced network that can offers itscustomers the fastest speed at 150Mbps in the industry vs 75Mbps on 4G‐LTE,14.4Mbps on 3G network. ADVANC uses its license‐based bandwidth and 2100MHzbandwidth from its partner ToT. In addition, ADVANC initiated R&D with Huawei todevelop mobile handset that can support data transmission larger than the currentmaximum level at 100Mbps.
2) Applications: ADVANC aims to develop mobile application, focusing on video streamingsuch as AIS Play, and to build AIS Cloud to provide its users cloud storage.
3) Services: ADVANC intends to improve quality of services and foster relationship with itscustomers.
4) People: ADVANC plans to enhance capabilities of its employees and those of itspartners.
For 3G network, there are currently 27, 000 base stations. ADVANC has allocated Bt20bn toincrease its capacity and extend its 3G network coverage to support its 13mn users (about amillion users on 2G, and 11mn users on 3G with 2G mobile handset—of which 1.5mn usersalready adopted 3G handsets) as its 900MHz concession ended last year.
‘BUY’ rating with target price of Bt230
The first‐half earnings will likely come under pressure from: 1) a Bt7,000mn‐Bt10,000mnmobile handset subsidy budget to encourage users to adopt 3G/4G handsets in order toaccess through 1800MHz and 2100MHz; and 2) intense competition from both existing andnew players. We think the company’s 4G services would help increase it competitive edge asits fastest speed is likely to accommodate growing demand for mobile internet, and itslargest customer base should allow ADVANC to benefit from lower cost per unit.
At current share prices, we rate ADVANC a ‘BUY’ rating with a target price of Bt230.

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