{"id":12153,"date":"2012-05-15T14:17:49","date_gmt":"2012-05-15T12:17:49","guid":{"rendered":"http:\/\/businesstech.co.za\/news\/?p=12153"},"modified":"2012-05-15T14:56:44","modified_gmt":"2012-05-15T12:56:44","slug":"fast-broadband-is-telkoms-only-hope-analyst","status":"publish","type":"post","link":"https:\/\/businesstech.co.za\/news\/telecommunications\/12153\/fast-broadband-is-telkoms-only-hope-analyst\/","title":{"rendered":"Fast broadband is Telkom\u2019s only hope: analyst"},"content":{"rendered":"

The only hope for Telkom<\/a> to increase its financial position is for KT Corp<\/a> to boost Telkom\u2019s fixed-line broadband penetration through better quality fixed broadband access. This is according to Hlelo Giyose<\/a>, chief investment officer and principal at First Avenue Investment Management<\/a>.<\/p>\n

Telkom has been struggling financially since the company sold its stake in Vodacom<\/a> in 2009, and even a deal with KT Corp did not help to bolster the company\u2019s share price.<\/p>\n

Giyose said that Telkom\u2019s only hope to boost its financial fortunes is to increase their fixed-broadband presence. \u201cTelkom\u2019s only hope is what KT will do \u2013 to spread broadband into the home as fast as possible and improve the quality of broadband [make it faster],\u201d said Giyose.<\/p>\n

Telkom is not a buy: Giyose<\/strong><\/p>\n

Despite the potential to boost Telkom\u2019s fortunes through better broadband services, Giyose remains negative about Telkom\u2019s financial future.<\/p>\n

Telkom\u2019s share price is currently at an all-time low, but Giyose said that, even at these low levels, it is not a good buy.<\/p>\n

Giyose argues that Telkom will never to earn a return above the cost of capital on their book value, which is around R56 a share.<\/p>\n

Despite the fact that Telkom\u2019s share price is trading at around 50% of its book value, Giyose said it remains a bad investment. \u201cThe probability of you earning a 50% return on Telkom\u2019s book value of R56 is zero,\u201d Giyose said.<\/p>\n

Related articles<\/strong><\/p>\n

Telkom agrees KT Corp deal at cut price<\/strong><\/a><\/p>\n

SA mobile subscriber numbers compared<\/a>
\n<\/strong><\/span><\/p>\n","protected":false},"excerpt":{"rendered":"

Telkom’s only hope is that KT Corp will assist it to boost fixed-line broadband penetration through better quality fixed broadband access.<\/p>\n","protected":false},"author":2,"featured_media":7050,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[21],"tags":[26,2159,65],"class_list":["post-12153","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-telecommunications","tag-headline","tag-hlelo-giyose","tag-telkom"],"_links":{"self":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/12153","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/comments?post=12153"}],"version-history":[{"count":11,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/12153\/revisions"}],"predecessor-version":[{"id":12539,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/12153\/revisions\/12539"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media\/7050"}],"wp:attachment":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media?parent=12153"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/categories?post=12153"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/tags?post=12153"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}