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Is TPG the biggest threat among telco aspirants?
It has a more solid funding advantage.
It may seem that the race for a telco spot in Singapore is a two-way fight between MyRepublic and TPG, but what gives TPG edge against its biggest rival for the spot?
According to the latest report by DBS Research, TPG has a stronger balance sheet that MyRepublic.
"TPG with a guided EBITDA of $792-797m at the current forex rate and FY16 (July year-end) net debt-to EBITDA at 1.6x, has enough room to raise over $500m to $1bn required to roll out a mobile network," DBS noted.
The report remained skeptic on MyRepublic's ability to raise the necessary funding.
This is "while only raising S$130m in debt funding as of late June compared to the company’s target capex of S$250- 300m. The company has not provided a recent update on its funding status," the report stated.
However, TPG's implementation of the network from scratch is likely to require a higher capital outlay that MyRepublic.
But this would mean TPG could spur a more serious threat among incumbents.
"Due to its stronger balance sheet, we are inclined to think a TPG win would have a higher impact on the overall market and incumbent performance," DBS declared.
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