True Corporation Plc is poised to reap the greatest benefit from the government's mandate to extend the 900-megahertz payment instalments, but investors could still embark on a sell-off of telecom shares, analysts say.
The government announced the use of Section 44 on Thursday to ease the financial burden of the three telecom operators that won the 900MHz spectrum auction in 2015.
The move postpones the last payment term for the 900MHz licences in 2020 by an additional five years. In exchange, they must participate in the planned 700MHz licence auction scheduled for this year.
The move was made despite dissent from academics who say it came at the expense of the state.
The order benefits Advanced Info Service Plc (ADVANC), True Move H Universal Communication (TUC) and Total Access Communication (DTAC) through its subsidiary DTAC Trinet.
The relief, published in the Royal Gazette, changes the payment plans to 10 annual instalments from the previous four instalments. It could prompt investors to embark on a sell-on-fact of shares associated with major telecom operators after the share prices of ADVANC, DTAC and TRUE climbed during the past two weeks, said Finansia Syrus Securities.
True is expected to reap the most benefit from the payment extension, as the move will ease the company's financial rigidity and help save interest payments during 2020-25 by an average of 1 billion baht a year, said an analyst at Capital Nomura Securities, speaking on condition of anonymity.
For DTAC, the move will help ease interest payments during 2022-27 by an average of 500 million baht a year, while AIS will benefit from lower interest payments at an average of 1 billion baht a year during 2020-25, the analyst said.
But the benefits of payment extension will be bartered by the planned 700MHz licence auction, whose conditions and spectrum investment sum have yet to be disclosed.