MTEL: Hungarian 5G auction cost HUF 129 bn - Equity Note from Concorde Securities Ltd.
MTELEKOM - Instant Earnings Comment
Recommendation: BUY (unch.)
Target price (12M): HUF 560 (prev. HUF 545)
Hungarian 5G auction cost HUF 129 bn
- Magyar Telekom won all the frequency blocks he needed, MTEL is required to pay a total price of HUF 54.24 billion for these frequency blocks, and this payment is expected to be due in the second quarter of 2020. The present value of the future annual band fees related to the acquisition of these frequency blocks will be capitalized in the amount of approximately HUF 33 billion in the second quarter of 2020. All of the purchased licenses will expire in 2035.
Magyar Telekom is engaged in the providing fixed line and mobile telecommunication services for public and business customers. Co. provides voice and non-voice (SMS, MMS, internet, data and content provision) within mobile services; voice, data, internet and TV services within fixed line services. In addition, Co. sells equipment needed for using fixed line and mobile services (telephones, tablets, notebooks, TV sets etc.).
Concorde Securities Ltd. is Hungary’s leading independent company engaged in investment banking activities. It provides its clients with integrated financial services, including securities trading, research, corporate financing advisory, capital market transactions, wealth management and investment advisory. The operational management of the company is the responsibility of the CEO, while the owners/managers (who control one-third of the company through their shares and options) are in charge of its strategic governance. Concorde Securities Ltd. is a member of the Budapest, Frankfurt, Warsaw and Bucharest stock exchanges, as well as of the Hungarian Association of Investment Service Providers.
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