CI Capital upgraded Telecom Egypt to "buy" from "hold," and said competitive pressures on the landline monopoly’s revenue should ease as the price war led by mobile operators is expected to cool off.
Telecom Egypt’s retail segment will likely be flat over the next five years as lower voice revenue should be offset an anticipated strong growth in internet and data revenue, the brokerage said in a note dated Nov 28.
CI Capital raised its price target on the company’s stock by 11 percent to LE 21.
Telecom Egypt is banking on data services to help offset lower fixed-line income, which has been hit by competition from the mobile market.
Earlier this month, the company said its voice revenue fell 23 percent in the first nine months of 2010, while internet and data revenue rose 22 percent. Shares of the company edged up more than a percent to 17.62 Egyptian pounds by 0932 GMT on Monday.
