SingTel

SingTel: SingTel is one of 11 remaining applicants still in the running for two telco licences in Myanmar, following the withdrawal of Vodafone and China Mobile. SingTel has partnered Myanmar Telephone Company (M-Tel) and KBZ Group. DB cites that the growth potential is very attractive with a population of 55m and estimated mobile penetration of <10%. The government has set an aggressive target of achieving 80% mobile penetration by 2016, which implies the two new entrants could each gain up to 15m subscribers over three years (assuming one-third market share each). This equates to c.4% of SingTel’s existing group mobile subscriber base (excl. Africa). Without also going into details of the broader issues around economic reforms, infrastructure development and labour supply, DB notes that the government’s penetration target seems optimistic in a country where two-thirds of the population is still rural while 70% of the labour force is in agriculture. House view that the telcos will face significant challenges seeding devices in this country, where GDP per capita (at US$1,400) ranks #205 in the world. DB has a BUY rating with TP of $4.23.