Thanachart Securities March 2011 - samartcorp.com
Transcript of Thanachart Securities March 2011 - samartcorp.com
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March 2011
Introduction & Key GrowthDrivers
Thanachart Securities
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59%70%
100%
100% 100%
TECH RELATEDBUSINESS
60%70%
Mobile multimediaICT Solutions & Services
Security solutions TV/Satellite antenna manuf Call Center Waste Mgt@ new airport
Air Traffic Mgt Power plant 23 MW
SAMART Inter Holding
100%
100%
Business Structure
4,300 mill shares (par Bt. 0.10/share)Mkt cap = $ 266 mill
601 mill sharesMkt cap = $ 228 mill
Listed in 1993977 mill shares
Market cap = USD 280 mill
Unlisted business valued at Book = USD 45 millor Baht 1.40/share (as of Sep 30, 2010)
* Market cap based on price of stocks & THB/USD rate as of 14th Feb 2011
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2008 2009 9M-2010
Total Profit 261 455 485
Contribution by :
SIM 25% 15% 14%SAMTEL 29% 47% 60%Other Biz 46% 38% 26%
3
Revenue & NP Breakdown by Businesses
2008 2009 9M-2010
Total Revenue 16,286 17,305 12,619
Contribution by :
SIM 70% 52% 51%SAMTEL 18% 36% 36%Other Biz 12% 12% 13%
(in Baht million)
Increasing contributionfrom Samtel
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Unlisted Business
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Samart Inter Holding
- Monopoly Concession to manage Nationwide Air Tarffictill year 2033
- Tariff collection from airlines (inbound & over flights)
(In kingdom of Cambodia)
477465000051876
41678
48630 242323
20
18
0
10000
20000
30000
40000
50000
60000
2006 (A) 2007 (A) 2008 (A) 2009 (A) 2010 (A)0
5
10
15
20
25
30
Flights Revenue ($ mill)
Strategy:
Explore similar investment opportunities in Indo-China region
- 9% CAGR for flights in past 10 yrs- Concession allows 5% tariff increase every 5 yr- EBITDA margins are maintained at 47%-50% for 10 yrs
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Samart Inter Holding
- USD 6 mill/year in revenue guaranteed per year- Fuel is supplied by off taker- EBITDA margins of 50%
Strategy:
Explore opportunities in utilities sector in Kingdom of Cambodia
Kampot
Kingdom of Cambodia - 16 MWe contracted capacity beginning 2008 till 2017- Off taker is Kampot Cement (Owned by Siam Cement)
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Outsource
Call Center
Government Private Sector
• ICT(����������� ������)
• Transportation(���.)
• TAT(ก ����������)
• MEA(���� �������)
• PEA(���� �� !� �)
• MOTC (� � � )
• MOC (" #!$�%)
• MOPH (� & �#�'�)
• MOL (��� �)
• MOI( � (���)
• MOF(ก ���)�)
• Bank
• Insurance
• Financial Firm
• Automobile
• PTT
• Microsoft
• HP/IBM
Customers
511
605
8901000
0
100
200
300
400
500
600
700
800
900
1000
2008 (a) 2009 (a) 2010 (est) 2011 (f)
20% CAGR
Revenues
Financials
ServicesFully outsourced 37% of total revenuesTurnkey 60% of total revenuesTraining 1% of total revenuesTelemarketing 2% of total revenues
One to One Contacts Co., Ltd.
One to One Contact CenterNature of business: Fully outsourced and turnkey call centerClients: 70% government, 30% private sectorProject on hand (as of Nov 2010): Baht 1000 million
Revenue drivers: Business Process Outsourcing contacts, call center contracts
Value unlock: Exploring possible listing in MAI
(Baht mill)
# 1. Independent Call Center
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Vision & Security System
Turnkey security solutions:
Customers:- Government Center- Bangkok Metropolitan Authority- Airport of Thailand (AOT)- Telephone Organization of Thailand (TOT)
73
191
328
500
0
50
100
150
200
250
300
350
400
450
500
2008 (a) 2009 (a) 2010 (est) 2011 (f)
65% CAGR
Revenues
(Baht mill)
Potential Opportunities 2011:
- CTX Scanners @ Suvarnabhumi Airport- Govt Center Phase II @ Bangkok- Chonburi Province Government
Project value over Baht 1,000 mill
Nature of Business: Provide security solutions
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Samart I-Mobile PCL
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SAMART i-Mobile Plc.
Samart i-Mobile PlcSamart i-Mobile Plc
Mobile BusinessMobile Business Content BusinessContent Business MVNOMVNO
• No.1 brand share • No.1 Content Aggregator
• No.1 distributor share
• Pioneer 3G telecom provider
Domestic market
International market
• ASIA Handheld device provider
Vision “To be the leading Thai telecom services company in the region providing
integrated telecom service, portable multimedia device, content
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11
“Theme: Devices, applications, services based on Mobility concept delivering enriched lifestyle experience to the end users”
Leveraging Strengths
� Total 40 i-mobile handset models to be launchedin 2011
i-Trip• Hit Hotel
• Weather
i-Music• Ringtone
• Full Song
i-Clip• Wallpaper
• VDO Clip
i-Movie• Movie Detail
• Show Time
i-Horo• Gypsy
• Birthday
• Etc.
i-Game• Adventure,etc
• Multiplayer
i-Food• Hit Restaurant
• Search
i-Sport• Football, etc.
• Match/Result
i-News• Local
• International
i-Promotion• Discount
• Rewards
• Privileges
i-Lotto• Result
• Analysis
i-Application• Stock watch
• Biz info
Device Applications
M-Commerce Application
Air Asia
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Product Positioning to Meet Market Demand
New 3G network, New devices:
USB Modem
2G + 3G
3G ANDROID
Featured Phone
• New Products to support Content, thus creating a revenue stream
• Data usage shall led to more ARPU for MVNO as well as traditional operators
Concept Phone: Smart feature
Smart phone & 3G device:
Handheld as carrier for Content & MVNO Business
Key Benefits:
i-Note
Push SNSIMM SNS Game
No.1 brand share in Thailand
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2,780,0113,027,904
3,498,804 3,500,000
353,062700,000
518,6131,258,130
0
500,000
1,000,000
1,500,000
2,000,000
2,500,000
3,000,000
3,500,000
4,000,000
4,500,000
2008 2009 2010 (Est) 2011 (f)
13
4,038,191
3,546,517 3,851,866 4,200,000
14.00%
13.96%
12.80%
14.00%
3,200,000
3,400,000
3,600,000
3,800,000
4,000,000
4,200,000
4,400,000
2008 2009 2010 (Est) 2011 (f )
12%
13%
13%
14%
14%
15%
Total Handsets Sales & Gross Margins
Handset Sales & Margins: 3G and replacement market to drive the sales
Handset sales: Domestic vs Inter
Inter
Domestic
- Handset sales growth = 10% (by volume)- Indonesian handset sales to grow the most- Margin trend is likely to be sustained in the neighborhood of 12-14% in 2012- Estimated market share in 2012 = 28%-30%
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New 3G network, Advanced content & application:
Voice and Conventional VAS 3G Advanced VDO & Application service
Key positioning: Content & Applications as key drivers of 3G Business
• Higher ARPU
Benefits:
Call Directory service
Sport
Lifestyle
VDO Call Center VDO Horo & Consult
Live SportStreaming
Live News Reporter
Music VDOStreaming
Entertainment
News
Develop to 3GAdvanced Service
Continue 2GService
Recurring Revenue on 2G Network with subscription service
EDT GuideApplication
eMagazine
Content Business: Big potential from 3G
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15
Content Business: Big potential from 3G
Directory
Main Revenue Stream
Alert &Subscription
Recurring Revenue
HoroscopeSportInformation
Main Revenue Stream
Download15%
Sport36%
Consultancy1%Chat
7%
Horoscope10%
Information11%
Voting & TVC Service
3%
Entertainment
4%
Game13%
Bug 1900 categories
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16
Transition: From Trading to Services
Device
Applications
DistributionNetwork
Call Center
Brand
SIM is in the best position to leverage its strengths and migrate its business model to MVNO services platform
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MVNO Growth Drivers
Status
Nature of business: Mobile Virtual Network OperatorSubscribers: 125,000 (as of Dec 2010) ARPU = 180 baht/subExpected sub by end 2011: 300,000
Revenue drivers: Upon TOT’s nationwide 3G rollout, i-mobile 3GX to become asingle largest MVNO
Targeting 2,000,000 subscribers with ARPU of 300 2012-13
Possible cooperation from Axiata (Telekom Malaysia)International Roaming revenues
2010 20122011
• 3,000 Base Stations• Capacity 4 M Subs
• 5,220 Base Stations• Capacity 8 M Subs• 42 Mbps / 11 Mbps
• 550 Base Stations• Capacity 500K Subs• 7.2 Mbps / 1.6 Mbps
Network rollout plan
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Benefits of full MVNO:
• Self-control: Roaming, I/C, Number
• Differentiate: Tariff plan, VAS, QOS Management
A Greater scope to excel as TOT rolls out nationwide 3G network
• Wholesale capability: Able to resell the service
platform to MVNO/ Reseller
• Subscriber ownership
New 3G network :
Full MVNO
3) Sell to sub MVNO / Branded reseller
1) Existing customer database of i-mobile handset: Approx. 3.5 Millions of mobile handset sold / year
2) Good relationship with Government / State Enterprise / Big corporate: Soldier / Police / Teacher / PEA / Bank etc.
MVNO Business
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Business Synergy
MobileBusiness
MobileBusiness
ContentBusiness
ContentBusiness
MVNOBusiness
MVNOBusiness
Embed Content
& application
VAS Offering
Sub AcquisitionVDO Call center
Strengthen and Fulfill Business Position in Telecom industry by Synergy of essential factors
Terminal Device + Telecom Service + Content and Application
i-Link
IMM
Push SNS
Dual SIM 2G+3G
eBook
2G
3G
Bundling Package
Revenue Streamof 3G VAS
3G VAS
Content &Application Portal
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321
114 115 109
0
50
100
150
200
250
300
350
2007 2008 2009 9M-2010
8,857
6,753 6,293
4,425
5,300
3,183
1,661
1,094
662
730
800
698
0
2,000
4,000
6,000
8,000
10,000
12,000
14,000
16,000
2007 2008 2009 9M-2010
Content
International
Domestic
20
Revenue/NP/Dividend history
0.062
0.045
0.0283%
169%
75%
0
0.01
0.02
0.03
0.04
0.05
0.06
0.07
2007 2008 2009
0%
20%
40%
60%
80%
100%
120%
140%
160%
180%
Revenues Revenue breakdown by segment
Net Profit Dividend & Payout Ratio
(all figures in baht million, except for dividend))
15,434
11,398
9,039
6,365
0
2,000
4,000
6,000
8,000
10,000
12,000
14,000
16,000
18,000
2007 2008 2009 9M-10
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Samart Telcoms PCL
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Netw ork Service, 42%
System Integration, 25%
IT Outsourcing, 16%
IP Business, 12%
E-Business, 5%
Government, 93%
Corporate, 7%
Government, 87%
Corporate, 13%
Samtel Revenue: Govt. Clients Dominate
20092008
Netw ork Service, 80%
System Integration, 13%
IT Outsourcing, 3%
IP Business, 2%
E-Business, 2%
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System Integration
Key Project Highlights (Completed )
Ministry of InteriorInformation Super High WayLinking all provincial offices in Thailand (Baht 1,000 mill)
ITV MobileTV Broadcasting Station
Department of Industrial WorksComputer network systems for supporting services
Suvarnabhumi AirportDesign & Installation of Airport Information Management System (AIMS) in Consortiumwith Siemens, ABB, & Satyam (Project Value Baht 2,399 mill)
Suvarnabhumi AirportCommon User Terminal Equipment System (CUTE)(Project Value THB 2,000 mill)
Ministry of DefenseCommunication network System(Baht 799 mill)
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Samart Telcoms PCL: Growth Drivers
StatusProjects on hand
Total project backlog as of Sept 30, 2010 is Baht 5,000 million9M-10 Revenue = Baht 4,500 mill
Installation & Maintenance Contracts TOT
Project: TOT 3G network installation nationwide Value: Baht 16,290 millMaintenance p.a.: Approximately Baht 800 mill p.a.(5 yr)
Project: Next Generation Networks “NGN”Value: Baht 14,000 mill
Installation & Maintenance Contracts CAT
Project: Trunk Mobile Baht 450 mill, USO Baht 1,000 mill
Won “e” auction on Jan 28Expected contract signing21st FebDuration rollout : 12-15 monthsSamtel Portion: 10 bn
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Samart Telcoms PCL
StatusIT Outsourcing ContractsProject: Automatic Meter PEA, MEAValue Baht 1,500 mill
Project: CUTE Counter Check in Services (Other airports incl Makkasan)
Project: Extension of School Net Project (Baht 40 mill/month)Tenure 1.5 years per term
System Integration Projects
Project: Various, including network design, installation, etc.Nature: Turnkey (approximately completion within 12-18 months)Clients: Ministry of Interior
Ministry of DefenseSupreme Commander HQMinistry of JusticeTOT , CAT, PEA, MEA
Revenue per yr: Baht 2,000 million per year
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Samart Telcoms PCL
Status“E” ticketProject: Set up and own “E” ticket platform for public transportation Value Baht 1,200 mill
Target: Public bus, BTS, BMCL, customers
RFID @ Airport (Q1-11)
Project: Set up and own RFID tags & readers at international airportTenure: 5 yrsValue: Baht 2,500 mill - 3,000 mill
Department of Land (Q2-11)
Project: Set up “e” title system for land deeds nationwideTenure: 3 yrsValue: Baht 10,000 mill
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Revenue/NP/Dividend history
991
1,710
4,844 3,609
1,156
1,186
9021,348
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2007 2008 2009 9M-2010
Service Revenue
Product Revenue
2,177
2,900
6,216
4,511
0
1,000
2,000
3,000
4,000
5,000
6,000
7,000
2007 2008 2009 9M-2010
111112
292302
0
50
100
150
200
250
300
350
2007 2008 2009 9M-2010
Revenues Revenue breakdown by segment
Net Profit Dividend & Payout Ratio
(all figures in baht million, except for dividend))
0.10
0.25
0.100.10
30%
51%55%55%
0
0.05
0.1
0.15
0.2
0.25
0.3
2007 2008 2009 2010
0%
10%
20%
30%
40%
50%
60%
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New Business Opportunities
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- Attractive opportunities in Transportation sector (over next 24 months)
- Singling (back bone of mass transit)- Common ticketing- Signaling system for State Railway of Thailand- NGV Bus for BMTA- Rail projects from State Railway of Thailand- Monorail link for new terminal at Suvarnabhumi Airport- Rooftop solar installations (domestic use)
Brief Description: Proposed Projects
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Consolidated Financials
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15,43411,119
8,754 6,216
2,8352,117
4,4426,193
2,098 1,7012,0921,901
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2007 2008 2009 9M-2010
Related Business
ICT Solutions (Samtel)
Mobile Multimedia (SIM)
Consolidated Financials
19,649
12,619
17,30516,286
0
5,000
10,000
15,000
20,000
25,000
2007 2008 2009 9M-2010
RevenuesRevenue breakdown by segment
Dividend Payout
(all figures in baht million, except for dividend))
261
574
485455
0
100
200
300
400
500
600
700
2007 2008 2009 9M-2010
Net Profit
0.150.25
0.2
0.36
30%
53%
74%61%
0
0.05
0.1
0.15
0.2
0.25
0.3
0.35
0.4
2007 2008 2009 9M-10
0%
10%
20%
30%
40%
50%
60%
70%
80%
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Summary
- Maintain a healthy backlog of ICT projects under SAMTEL- Transform SIM from a trading business to a service based business - Successfully develop new projects under transportation sector- Company shall seek internal cash flows/project financing to finance these projects
- Revenue Guidance for 2011
- Samart Corp (Consolidated) +40%-45%- SAMTEL (incl TOT 3G) +120%-150%- SIM +10%-15%