Equity Analysis /

Advanced Info Service PCL: Steady flow of subscriber migration from merging rivals in 1Q22

  • Despite weaker 1Q22 mobile revenue, …

  • … 1Q22 core service revenue will still deliver a solid YoY rise

  • Insights into 1Q22—a YoY flattish core profit

Bualuang Securities
8 April 2022

Although 1Q22 mobile revenue will be weaker due to the Omicron spread and subdued spending, its core service revenue growth will be solid led by a double-digit growth of fixed broadband (FBB) and enterprise non-mobile revenues. The continued subscriber migration flows from its rivals after the TRUE-DTAC amalgamation announcement is a short-to-medium term boon for ADVANC. It is our sectoral pick, based on its improved 2022 core earnings.

Despite weaker 1Q22 mobile revenue, …

We expect its 1Q22 mobile revenue to drop YoY and QoQ, led by the extensive spread of Omicron and overall weaker spending in 1Q22 as well as the high 1Q21 base from the government’s two stimulus spending packages. We model a Bt29.18bn mobile revenue for 1Q22, down 0.6% YoY and 1.4% QoQ (against up 2% YoY and 1.3% QoQ in 4Q21). The competition in 1Q22 was more-or-less the same as in 4Q21 except that the low-priced prepaid package of Bt100 for 2Mbps speed has been removed from the market and high-priced ones such as Bt175 for 8Mbps and Bt200 for 15Mbps have been introduced and there are greater Mobile Number Portability (MNP) postpaid packages with 50% discounts offered for the operator migration. For 1Q22, we model net mobile additions of 420k, down 8% QoQ, led by lower postpaid additions, and its ARPU of Bt223, down 3.7% YoY and 0.3% QoQ.