Total Access Communication

Total Access Communication Plc (DTAC)
 

DTAC’s Q2 2012 results are likely to fall short of consensus expectations due to rising opex and its unpopular new voice price plans. This would pile on the pressure on DTAC to turn more aggressive on voice price promotions, resuming voice competition during exhausted elasticity. We maintain our estimates, DCF- based target price, and Neutral call on DTAC for now. Its failure to boost voice revenue in 2Q12 suggests our concern over stiffer voice competition is justified. Costs remain on the rise with the network swap completion delayed and more 3G cell sites installed. Except for its 6.1% yield, the stock lacks rerating catalysts.