Green Packet has proposed a 1-for-2 rights issue priced at 50 sen apiece. As a sweetener, shareholders will also receive one free warrant for every rights share issued. The rights issue is expected to raise some RM100 million for its future expansion purposes. Looking further ahead, it is also considering the separate listing of P1 for greater access to the capital market.
The company's other key business, software and applications, registered improved sales of RM8.8 million, up from RM3.3 million in 4Q08, but were insufficient to turn a profit yet. Still, operating loss narrowed to RM2 million in 1Q09, down from a loss of about RM7 million in 4Q08.
We expect the business will continue to improve as Green Packet reaps results from its various strategic alliances set up over the past year. Indeed, we expect the unit to return to the black in the second half of 2009 (2H09).
Alliances with global players like Alcatel-Lucent, Motorola and Cisco have boosted sales for the company's software solution and WiMAX CPE (customer premise equipment). Most recently, Green Packet secured a contract from Tatung Infocomm, a WiMAX service provider in Taiwan, to provide customised Intouch Connection Management Platform. The platform enables seamless handoff between WiMAX and WiFi networks without having to reestablish a connection. Earlier in the year, the company inked a similar deal with PCCW, one of the largest telcos in Hong Kong.
Green Packet is also redoubling its marketing efforts in China, whose mobile networks are currently based on multiple platforms. This translates into opportunities for the company's seamless roaming solutions to integrate the various networks.
China has just awarded 3G licences to the three state-run telcos - China Mobile, China Unicom and China Telecom. The government has dictated that each network will be based on different platforms. Capital spending on 3G-network rollout this year alone is estimated at US$20 billion (RM70.6 billion). Green Packet already has working relationships with major Chinese telcos - the company secured its very first deal in China, with China Telecom, way back in 2003.
Note: This report is brought to you by Asia Analytica Sdn Bhd, a licensed investment adviser. Please exercise your own judgment or seek professional advice for your specific investment needs. We are not responsible for your investment decisions. Our shareholders, directors and employees may have positions in any of the stocks mentioned.
-taken from The Edge Malaysia (www.theedgemalaysia.com)
2 comments:
I think 2010 holds a lot of promise but already the 2nd quarter of 2009 too has shaped up incredibly well. There are many markets that are up more than 50 percent. How has that been possible, no one even predicted it or saw it coming. There are still greater monetary opportunities waiting to be tapped.
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