Bloomberg News

Thaicom Gains Most in 18 Months on China Partner: Bangkok Mover

January 02, 2013

Thaicom Pcl (THCOM), Thailand’s satellite monopoly, gained the most in 18 months in Bangkok trading after saying it agreed to form a new partnership to help sell its high-speed Internet services in China.

The shares surged 9.3 percent to 25.25 baht at the close, the biggest gain since July 2011. The stock was the third-best performer on the SET100 Index (SET100), which rose 1.1 percent.

Thaicom, controlled by Singapore’s Temasek Holdings Pte, signed an initial agreement on Dec. 30 with a unit of Hong Kong- based Synertone Communication Corp. (1613) to become the new provider of its Ipstar services in China, according to a regulatory filing today. Thaicom has banked on higher revenue from its Ipstar satellite, an orbiter that offers high-speed Internet services, to return to profit after four years of annual losses.

“The announcement is very positive for Thaicom because sales of Ipstar services in China have been very disappointing,” Chirasit Vuttigrai, an analyst at DBS Vickers Securities (Thailand) Co. in Bangkok, said by telephone. “This raises optimism that the Ipstar business in China will significantly improve with the new partner.”

Under the agreement, Synertone will become the sole provider of Ipstar service capacity available for mainland China, Thaicom said. The Chinese market accounts for about 24 percent of total capacity of its Ipstar satellite, it said. The orbiter is the company’s biggest satellite.

Thaicom may buy an equity stake in Synertone, according to the Thai company. A final agreement between Thaicom and Synertone must be signed by March 31, it said.

The partnership will enable Synertone to explore a new source of revenue and expand its customer base for specialized communication products, the company said in a separate statement on Dec. 30.

Thaicom posted an annual loss every year between 2008 and 2011, according to data compiled by Bloomberg. It had a profit of 50 million baht ($1.6 million) in the first nine months of 2012, compared with a net loss of 175.6 million baht in the same period a year earlier, it said Nov. 13.

To contact the reporter on this story: Anuchit Nguyen in Bangkok at anguyen@bloomberg.net

To contact the editor responsible for this story: Darren Boey at dboey@bloomberg.net


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