- Telekom Malaysia (TM) survived a challenging 2018 with stable business performance despite a huge decline in net profit.
- TM is expected to bounce back in 2019 with growth in enterprise, driven by PIP 2019 and a vertical focus.
2018 was a challenging year for telcos in Malaysia. The Mandatory Standard on Access Pricing (MSAP), set by the new government, has pushed down connectivity prices in the country. As the domestic fixed-line market leader with a connection share of 66% (source: GlobalData Malaysia Telecom Forecast Q4 2018), Telekom Malaysia was heavily impacted by this new regulation. The provider had to reduce its connectivity service price by around 40% whilst offering up to 10 times the speed for some of its packages in order to meet the new regulation. As a result, credit rating agencies such as Fitch revised the company’s outlook from ‘stable’ to ‘negative’ and the S&P changed TM’s profile from ‘intermediate’ to ‘modest’ last year. Its share price went down by 57.0%, from RM6.18 (at the beginning of 2018) to only RM2.66 at the end of the year. (It has gone back up since November and closed at RM3.18 on March 8, 2019.) Continue reading “Regulation Change Did Not Impact Telekom Malaysia’s Overall 2018 Business Performance, but Pushed TM to Accelerate Its Transformation”