2412 TT (Chunghwa Telecom Co., Ltd.)
Chunghwa Telecom Co Ltd
TMT
06/03/2013
Presented
| Date | 05/30/2013 |
| Price | NT$95.60 |
| Market Cap | $23.90B |
| Ent Value | $22.15B |
| P/E Ratio | 19.98x |
| Book Value | NT$46.98 |
| Div Yield | N/A |
| Shares O/S | 7,757.45M |
| Ave Daily Vol | 6,600,000 |
| Short Int | N/A |
Current
| Price | NT$123.50 |
| Market Cap | $30.49B |
| Chunghwa Telecom Co., Ltd. provides integrated telecommunication services primarily in Taiwan. It offers domestic fixed communications services, including local and domestic long distance telephone, broadband access, local and domestic long distance leased line, multimedia-on-demand (MOD), Wi-Fi, and domestic data services; and mobile communications services comprising mobile, paging, information and communication technology, corporate solution, and bill handling services. The company also provides Internet, data communication, Internet data center, and other Internet services; international fixed communications services that comprise international long distance telephone, international leased line, international data, and satellite services; other services, including the provision of interconnection of its fixed line network and mobile network with other operators; and ICT services, such as cloud computing. In addition, it sells mobile handsets and data cards; and leases real estate properties. The company primarily serves small and medium-sized enterprises, and large corporations. As of December 31, 2012, its transmission networks consisted of approximately 1.4 million fiber kilometers of fiber optic cable for trunking; and approximately 5.84 million fiber kilometers of fiber optic cable for local loop. The company also provided ADSL and FTTx services to 4.6 million customers; local telephone services to approximately 11.79 million customers; Wi-Fi services to approximately 1,280,315 residential and business customers; MOD services to 1.2 million customers; mobile services to 10.3 million customers; and Internet services to 4.2 million subscribers. Chunghwa Telecom Co., Ltd. was founded in 1996 and is headquartered in Taipei, Taiwan. |
Highlights
The presenter is bearish on the outlook for Chunghwa, as its shares are currently trading at relatively rich multiples (approximately 16x EBIT, 9x EBITDA, and 20x earnings), and likes the risk/ reward at this time. The government’s ownership of Chunghwa puts the company at a disadvantage because it cannot own content and regulators are pushing for 100 Mbps internet (which requires a heavy capex commitment).
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