Upbeat outlook for OCK Group in 2023

Kenanga Research said the telecommunications network services provider is looking at tremendous growth opportunities in the telco infrastructure space, both at home and abroad.

PETALING JAYA: The outlook moving further into 2023 appears bright for OCK Group Bhd, says Kenanga Research.

This will be underpinned by positive factors, including being well positioned to benefit from the Jendela initiative, as well as the 5G rollouts domestically and in other Asean markets.

According to Kenanga Research, the telecommunications network services provider is also looking at tremendous growth opportunities in the telco infrastructure space both at home and abroad, especially in the underserved areas.

Based on a recent OCK post-results briefing, the research house said the group is expecting new orders from Malaysia and its regional markets, comprising of contracts worth RM200mil under the Jendela 2 initiative on fiberisation of 4G sites, mostly in Sabah and Sarawak, and preparation works for 70 5G sites in Malaysia on top of an additional 70 towers in Myanmar.

“For the financial year ended Dec 31, OCK met its target of rolling out 100 new towers and its current order book stands at RM385mil, mostly in Malaysia,” noted Kenanga Research.

Apart from building and leasing towers, the group is also looking at acquiring more towers in Vietnam, in addition to its existing 3,500 towers.

In addition, OCK had also received its Laotian tower communication licence in January 2023.

Business operations are expected to commence in the second half of the year on a “build to suit” or “build to lease” basis.

On the local front, the research house said OCK is expecting the full 5G rollout to last for another three to four years, which would also require the building or upgrading of 8,000 to 10,000 sites, with 3,500 of these sites having been ordered by Digital Nasional Bhd in the initial phase.

Kenanga Research has an “outperform” call on the stock with a target price of 69 sen.