KUALA LUMPUR: Affin Hwang Research has maintained its Add rating on Maxis with a target price of RM6.92 and remained confident of the operational changes that are being implemented at Maxis to aid its transformation.
In a note on Friday, the research house said as Maxis has among the best network infrastructure and coverage, it believed this will contribute to a strongerfinancial performance in 2015E.
"With a 4.6% dividend yields for 2015E, investors should also be kept at bay until the turnaround story further avails," it said.
It added that prepaid revenue has improved for two consecutive quarters while new packages and a re-pricing strategy has helped lift its postpaid subscriber base. However, judging by the overall 9M14 revenue contraction, the turnaround at Maxis could still be in its early days.
Maxis reported better ebitda margins of 52.9% despite weaker revenue, which fell 0.8%. This was, however, due to a staff-cost reversal amounting to RM44mil, which subsequently lifted core earnings by 2.9% on-quarter.
Third quarter core earnings were down 10.2% on-year primarily due to lower revenue and also higher interest expense, it said.
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