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KUALA LUMPUR : Malaysia largest telco, Telekom Malaysia, has allayed investors' concerns over Singapore's Temasek Holding's decision to cash out at a discount.
Speaking after the company AGM, Telekom's CEO Abdul Wahib Omar described the sell-off as nothing more than an exercise by Temasek to re-align its portfolio.
Mr Abdul Wahid said: "I guess they have their rational, in terms of why they are selling. Probably it's because of their realignment of their portfolio, given the fact that they have a sizeable stake not only in SingTel in Singapore but also in STT, which is another telco, which has got significant stake in Indosat in Indonesia. Now that that block is sold, the market, we hope that will pave the way for future appreciation in the share price."
Temasek used to own around 5 percent of Telekom Malaysia and has been selling down its stake in the past few months.
With the largest block now sold, Mr Abdul Wahib believes the selling pressures on Telekom Malaysia shares will ease.
Its stock price dipped 2 percent on Monday following Temasek's exit.
Analysts believe the move highlights the key risks faced by Telekom Malaysia, and its outlook, especially with its languishing fixed line business and intense competition faced by its mobile business.
But Mr Abdul Wahib remains bullish that Telekom Malaysia is on track to achieve its full-year growth forecast.
The company has also earmarked US$2 billion for expansion. - CNA/de
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