Morning News &Views -Asia:A Summary of Select Global Markets Research

Growth potential from 4G, but at lower pace

    Normalising of growth, but many events to watch out for. Indo towercos have been weak over the past two years,and out of favour with investors. This has been partly due to market concerns on potential declines in rental yieldsand lower tower/tenancy rollout orders from telcos. We highlight some structural changes ahead, which we think arelikely to keep towercos topical. However, the impact on financials could be mixed, and we have a Neutral view onthe sector: we are Neutral on TBIG and initiate on STP with a Neutral. We reaffirm our Buy rating on Protelindo, butliquidity is low. XL-ISAT network sharing could pick up gradually. There are concerns on network sharing impactingincremental towers and the tenancies of towercos, which have to be monitored. However, the removal of sitesinvolves a fair bit of negotiation on the details. Furthermore, there is still room for improvement in network coveragein the market, and data is in the early stages of usage and growth.