Riyadh – Mubasher: Riyad Capital expected that Saudi telecom companies will stablilise in the fourth quarter of 2016, after 9 months from the changes seen by the sector.
The research firm said that three operators, STC, Mobily and Zain KSA, are likely to see enhanced license amortisation expenses resulted from extending the license period.
Zain KSA will be the highest beneficiary, where it will pay SAR 11239 million for license amortization instead of SAR 237 million, according to the report.
Riyad Capital estimated a 13% rise in the net profit of the three telecom operators in Q4.
Saudi Telecom Company (STC) is expected to achieve SAR 2.18 billion profits in Q4, compared to SAR 1.95 billion in the year-ago period, Riyad Capital said reducing its recommendation on the company from selling to Neutral with a target price at SAR 73.
On the other hand, Mobily is likely to record SAR 159.5 million losses in Q4 against SAR 10 million profits in the same period of the last year. The research firm maintained its recommendation on the company with a target price at SAR 26.
Moreover, the research firm said that Zain KSA's losses would shrink to SAR 147 million in Q4 from SAR 291 million in Q4-15.
