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Intouch Holdings PCL (SET:INTUCH), formerly Shin Corporation PCL, is a Thailand-based company engaged in investments in satellite, internet, telecommunications, media, IT and digital content. The company owns a 40.45% stake in Advanced Info Services PLC (SET:ADVANC), a 41.14% stake in Thaicom PLC (SET:THCOM), which owns 42.07% stake in CS Loxinfo PCL (SET:CSL), the leading internet, computer and telecommunication service provider (ICT service provider) in Thailand.
In 2012, Intouch founded InVent, a corporate venture capital (CVC) company, focusing its investments in technology companies in late-seed or expansion stages in Thailand and Southeast Asia.
Intouch said on August 11, that its second-quarter 2016 revenues, ending June 30, were 2.93 billion baht, down 2.01% from 2.99 billion baht during the same period last year. The company posted second-quarter 2016 diluted earnings per share of 2.41 baht, up 89.76% from 1.27 baht during the same quarter last year. The surge in consolidated earnings was mainly due to the reversal of a provision for unpaid operating fees and interest for ITV of 3.69 billion baht (net of non-controlling interest).
Advanced Info Service (AIS), top holding of Intouch, reported its second-quarter 2016 revenues on August 4 of 36.48 billion baht, missing the 36.69 billion baht consensus estimate by two analysts, according to the Financial Times. AIS posted second-quarter 2016 earnings of 3.23 baht per share, missing the 3.26 baht per share consensus estimate of two analysts. Marketing expenses rose 92% year-on-year, to 3.1 billion baht, as AIS continued distributing subsidized handsets to encourage more users to subscribe to 4G services.
On August 18, Singapore Telecommunications Ltd. (Singtel) said it was buying 21% of Intouch Holdings for S$1.59 billion (US$1.16 billion). Singtel already owns a 23.3% stake in ADVANC, meaning Singtel’s direct and indirect stake in ADVANC has increased to 31.8%. The transaction is expected to be completed by December 2016, pending shareholder and regulatory approvals.
Shares of Intouch Holdings have been moving in a descending broadening wedge chart pattern since 2013. The stock is stuck near-term in a triangle chart pattern and needs to break out the 60 and 64 baht head resistance levels. There is significant downside risk if the stock breaks down the 50 baht support level. As of September 2, 2016, the consensus forecast amongst 13 investment analysts polled by the Financial Times advises investors that the company will Outperform the market, with the median 12-month price target of 64.50 baht per share.
Disclosure: No position in INTUCH, or any other companies mentioned, and no recommendations. |
