SingTel forays into Myanmar with latest mobile bid

Market has less than 10% penetration.

According to DBS, SingTel has submitted its bid in partnership with local players - KBZ and M-Tel. KBZ runs banks, airlines and several other businesses in Myanmar.

There is not much known about M-Tel. Myanmar is expected to announce the winners on 27 June, 2013. The two winners will be in addition to the existing two players and will participate in a virgin market with < 10% mobile penetration.

Here's more from DBS:

EV of the winning bid could be US$2.8bn or ~5% of SingTel’s EV. Assuming enterprise value per subscriber of US$135m (10% premium to Indonesia), 100% mobile penetration and 35% market share, each winning bid could be worth US$2.8bn or about 5% of SingTel’s EV of ~US$52.4bn.

Hence to create shareholder value, each winner needs to make sure that its cumulative capex is substantially below US$2.8bn over the life of the investment.

Myanmar aims to achieve 75-80% mobile penetration by 2015-16, which is too ambitious as seen in Cambodia, in our view.

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