Axiata stock faces lower target despite stronger earnings outlook
Published on 11/03/2026 at 03:15 | Editorial responsibility: Rafael Müller, Editor-in-Chief AD HOC NEWSEarnings outlook and valuation pressure
- CGS International raised its FY26 EBIT forecast after stronger performances at Dialog Axiata and Robi Axiata.
- Currency effects, index removal and lower Edotco valuation expectations continue to weigh on Axiata's valuation.
- Potential monetisation of the tower business remains a catalyst for narrowing the discount to revised net asset value.
Axiata Group Berhad is facing a mixed investment picture after CGS International raised its earnings outlook but lowered its valuation target. The Star reported on Monday, October 26, 2026, that the research house lifted its FY26 earnings before interest and tax forecast by 21.9%, while reducing its target price to RM2.67 from RM2.87.
Improved subsidiaries, persistent pressure
CGS International attributed the earnings upgrades to stronger performances at Dialog Axiata in Sri Lanka and Robi Axiata in Bangladesh. Their profits rose 78% and 17%, respectively, in ringgit terms during the first half of 2026.
The stronger ringgit against the currencies of Axiata's overseas subsidiaries partly offset the operational improvement. The research house also lowered its FY27 core net profit forecast by 5.2%, citing a smaller expected contribution from associate CelcomDigi.
Axiata's valuation remains under pressure after its removal from the MSCI Malaysia Index. CGS International said the share-price decline and lower expectations for telecommunications tower subsidiary Edotco had widened the discount to revised net asset value to 45%.
Edotco remains the key catalyst
The research house cut its revised net asset value estimate to RM2.97 from RM3.19 after updating valuations for CelcomDigi and Axiata's operating subsidiaries, as well as currency assumptions. It maintained an "add" recommendation and identified possible Edotco monetisation as a catalyst for narrowing the valuation discount.
Management said in August that it was exploring options to unlock value from the tower business. For investors, the outlook therefore depends on whether stronger operating results can outweigh currency effects, portfolio valuation pressure and uncertainty around future asset sales.
Axiata's regional portfolio
Axiata is an Asian telecommunications and technology group and active asset manager based in Malaysia. Its portfolio covers mobile, fixed and converged connectivity for consumer, home and enterprise customers, telecommunications infrastructure, and digital financial and data-transformation businesses across Asia. The group serves more than 190 million customers through telecoms, infrastructure and digital assets, giving it a broader regional portfolio than a single-market operator. Dialog Axiata and Robi Axiata are among its key operating businesses.
Axiata Group Berhad at a glance
- Company: Axiata Group Berhad
- ISIN: MYL6888OO001
- Business: Telecommunications, infrastructure and digital technology assets
- Region: Asia
- Analyst target: RM2.67, reduced from RM2.87
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