Company Trend Analysis - edotco's Expansion To Assist Advanced Service Development - AUG 2017
BMI View: e dotco 's expansion of its existing operations in Pakistan will be beneficial for the market . A s a dedicated tower operator , it can provide more efficient connectivity solution s to telecoms operators that need to develop advanced premium 3G/4G services .
Axiata subsidiary edotco plans to acquire Pakistani tower operator Tanzanite Tower Private Limited for USD90mn, as part of edotco's Asian expansion strategy. The deal would add 700 towers to edotco's portfolio, which currently consists of 25,000 towers across several South and South East Asian countries. This deal would make edotco the largest dedicated telecoms infrastructure company in Pakistan and improve its traction with the country's cost-conscious mobile operators.
There are broad long-term investment opportunities for edotco and other towers companies in Pakistan. There is considerable scope for organic growth in mobile and 3G/4G subscriptions and we believe these will drive growth in the short to medium term. More infrastructure will be needed, but quick returns will remain elusive for operators while they continue to bear related capital costs. Mobilink's acquisition of Warid and its infrastructure assets in Q316 shows that operators are under pressure to invest in infrastructure to remain competitive ( see ' One To Watch: Pakistan Telecoms Market ', January 5 2017) but must also invest in innovative services, which an infrastructure-led business model does not always support.
|Growth In Mobile Voice And Data Subscriptions To Drive Market|
|Pakistan - Mobile & 3G/4G Subscriptions|
|f = BMI forecast. Source: Operators, PTA, BMI|