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=MARKET BUZZ: Malaysia’s Axiata Up; Potential edotco IPO May Unlock Value-Kenanga

KUALA LUMPUR (Mar 16) -- Axiata Group rises 3.9% to MYR5.40, after it touched 4-month low of MYR5.22 yesterday. Kenanga Investment Bank says unit edotco’s initial market capitalization post potential initial public offering could be over MYR8 billion. Bloomberg had earlier reported Axiata was considering IPO for edotco to raise at least MYR500 million, and the exercise could take place as early as 2018. edotco could potentially be listed at a 113% premium compared to regional peers’ average 31.1x price-to-earnings, house says in investor note. “The rich indicative price-to-earnings (PER), however, is positive to Axiata given that the latter is merely trading at FY18 PER of 34.7x,” house says. Views deal could raise Axiata’s target price by MYR0.11 to MYR5.46. Keeps Market Perform call for Axiata with MYR5.35 target price.

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