VEON (Buy, TP: $65, +93%) Q3 24 Quick Take: Revenue in-line but EBITD...

Revenue came in-line with expectations led again by Pakistan and Kazakhstan with Ukraine improving further. However, underlying EBITDA was softer against last quarter.

A-rated TMT credit investments/Better credits at similar spreads

In this report we evaluate the single-A TMT space. We argue that the notes of Wolters Kluwer, Relx, Swisscom and ASML look attractive. The notes of SAP and Telenor look to trade at fair value. As spread curves trade rather flat, we prefer notes in the belly of the curves. In this note we provide a summary of our general findings, followed by company descriptions.

Telenor (Buy, TP: NOK 180, +30%) Q3 24: Nordic guidance lifted, and y...

Telenor has reported a solid set of Q3 numbers (c1% EBITDA beat) and has lifted some key Nordic guidance parameters: Group FCF guidance for 2024 and 2025 is now +6% and +11% ahead of consensus respectively.

Adj. EBITDA 1% above, strong FCF

True Q3: EBITDA +3% q-o-q, net debt down

VEON (Buy, TP: $65 from $40, +117%) Focus on Digital, Buy, PT to US$6...

VEON is more exposed to a wider range of “beyond telco” assets than almost any other EM Telco. We deep dive on these, as well as assess the synergies from network separation/consolidation. As a result, our price target rises from US$ 40/ADR to US$ 65. VEON remains a top pick for us in Global EM.

Telenor (Sell, TP: NOK125.00) - 2025 Nordics capex risk remains

While we are only just below consensus on 2024–2026e adj. EBITDA, we are well below on FCF before M&A, and reiterate our SELL given our concerns Telenor will struggle to meet its 2025 capex-cutting ambitions for the Nordics amid headwinds, e.g. the ongoing fibre roll-out. Longer-term, we struggle to get excited about easing capex requirements, particularly in Norway, where competitive pressure is only likely to ratchet up. However, we have raised our target price to NOK125 (110).

Telenor (Buy, TP: NOK180, +32%) Telenor – Target up to NOK180, +32%, ...

Telenor has been a good YTD performer, with the shares +17%. This has been in the large part driven by the impressive share price performance of TRUE, >100% YTD. We recently held an NDR with TRUE management (HERE) and continue to be very bullish on the outlook. Following those meetings we are lifting our target on TRUE to THB18/share from THB15/share.

Lyse roaming agreement lifts FCF 2.5%

EU TELECOMS REFRESH: Can the outperformance continue?

When was the last time we could write that the EU Telecoms sector has been the second best performing sector in the market YTD? As a result, this raises the question of whether the outperformance can continue. We believe regulation will ultimately determine the answer to this question.

EMEA & African Telcos & Towers - High Yield Review – Initiate Coverage...

Following similar efforts in Europe and LatAm we are launching coverage on the HY Telcos & Towers in EMEA & Africa. New names under coverage include Helios (also initiated on equity, pt GBp140), Axian Telecom and Liquid Intelligent. We also address IHS Towers (pt cut to US$ 6), VEON and Helios’ bonds.

VEON (Buy, TP: $40, +33%) Feedback from VEON NDR

We hosted VEON in London and New York over the last fortnight. Financing risk has improved materially, and operationally the company continues to perform well in our view.

FTE cuts are not enough

VEON (Buy, TP: $40, +48%) Q2 24 Quick Take: Trends still good; guidan...

VEON delivered a good set of numbers, despite some slowdown. Key markets such as Pakistan and Kazakhstan continue to be key drivers while Ukraine improved. ARPU metrics remain good in our view with digital’s share of revenue rising. We do not think bullish medium term guidance are fully reflected in today’s valuation and as such, VEON remains a compelling BUY for us with a US$ 40/ADR price target.

Another strong report from True

VEON (Buy, TP: $40, +52%) US$100m share buyback announced; delisting ...

VEON announced plans to delist from Euronext Amsterdam in 4Q24. It will remain listed on the NASDAQ via ADRs and has announced a share buyback of up to US$ 100m subsequent to the de-listing.