'Credit profile of mobile operators improves'<\/p>\n
Agence France-Presse, Manila<\/p>\n
Mobile telephone operators in Southeast Asia are significantly
\nimproving their credit profiles on the back of growing subscriber
\nbases and revenues, Moody's Investors Service said on Monday.<\/p>\n
The ratings agency said all its rated mobile phone issuers in
\nthe region exhibited enhanced financial conditions, benefiting
\nfrom a strong uptake in cellular telecommunications in
\nessentially under-penetrated environments.<\/p>\n
According to a Moody's study, mobile phones have now become
\nthe principal mode for voice transmission in Thailand, Indonesia,
\nMalaysia and the Philippines.<\/p>\n
The study covered only the region's four emerging economies
\nand excluded Singapore, whose cellular market is one of the most
\ncompetitive in Asia, marked by high penetration rate, with eight
\nout of 10 residents in the city state a mobile subscriber.<\/p>\n
\"Most major operators in these countries -- by achieving
\ncritical subscriber mass -- have secured greater certainty in
\ntheir abilities to fund growth, access capital markets to
\nrefinance maturing debt and provide investors with returns,\" says
\nCharles Macgregor, Moody's vice president and senior credit
\nofficer.<\/p>\n
\"Consequently, Moody's believes that the ability of operators
\nto meet their funding needs -- covering investments and maturing
\ndebt -- has become a diminishing concern,\" Macgregor said.<\/p>\n
The report said the credit profiles of the region's mobile
\noperators had improved in the six years since the 1997-1998 Asian
\nfinancial crisis, partly reflecting enhanced economic
\nfundamentals and better technology.<\/p>\n
\"Going forward, given the healthier financial and operating
\nprofiles, strategic investor support may not be as critical as
\nbefore,\" Moody's said.<\/p>\n
\"And now that the threat of corporate collapse has eased
\ndramatically, for most rated operators it is more an issue of
\nsustaining competitive positions.\"<\/p>\n
However, the Moody's report also cautioned that the region's
\noperators were still exposed to \"varying degrees of risk from
\nmacroeconomic trends, political volatility, and to a lesser
\nextent foreign exchange moves and regulatory changes.\"<\/p>\n
The region's regulatory environments currently pose a
\n\"moderate level of risk,\" Moody's said.<\/p>\n
In the coming 12 to 24 months, Moody's said, decisions by
\nregulators -- centering on tariffs and interconnections -- were
\nlikely to be the next source of regulatory impact on credit
\nprofiles.<\/p>\n
Other challenges include the need to cut costs to grow profits
\nas cellular penetration nears saturation, greater sensitivity to
\neconomic activity, shareholder pressure for higher returns and
\nregulatory pressure to keep tariffs low.<\/p>\n
Macgregor noted the region's telecoms regimes continued to
\nevolve and that the importance of earlier concerns -- such as
\nliberalization time frames and competitor numbers -- had become
\nless significant.<\/p>\n
\"Uncertainties, however, over issues such as tariff
\nstructures, taxation, access and interconnection regimes
\npersist,\" he said.<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/credit-profile-of-mobile-operators-improves-1447893297",
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"sponsor": "Okusi Associates",
"sponsor_url": "https:\/\/okusiassociates.com"
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