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Telcos to remain under pressure

4 November 2009
♪♫ um bam ba dee.. um bu bu bam da deeee.. under pressure.. ♪♫
Telcos to remain under pressure
Shares in the big three telecommunications companies are expected to remain under the weather as the credit crunch, interconnect concerns and slowing growth take their toll on the groups.

Chris Gilmour, an analyst with Absa Investments, says telcos are "under major pressure" to find new sources of revenue, and this is reflecting in their share prices.

He points to several issues, such as concerns over what impact an expected cut in interconnect will have, and slowing penetration in markets. Fundamentally, they are all not looking as good as they used to."

Frost & Sullivan ICT industry analyst Spiwe Chireka says telcos are facing growth constraints, and this could impact their shares.

MTN closed at R117.50, at the end of last month, which was a slight respite from its R109 close a year ago. However, the stock has been in play and after the Bharti Airtel deal was cancelled, rose to R129 before coming back down. Yesterday, it closed at R114.99.

MTN ...

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