Time DotCom stock gets CIMB upgrade as dividend case holds

CIMB Securities upgraded Time dotCom to "Buy" on November 6, citing defensive qualities, dividend income and the potential medium-term value of its 30 percent stake in data centre operator AIMS. The research note, carried by KLSE Screener, also lowered the target price to RM6.05.

Dividend case remains central

CIMB expects dividend yields of 6.7 percent annually from financial years 2026 through 2028 before normalising to 5 percent from financial year 2029. The firm cut its dividend-per-share forecast for financial years 2026 through 2028 to 37 sen from 43 sen and expects net debt to reach 1.2 times earnings before interest, taxes, depreciation and amortisation by the end of financial year 2029.

Margins face second-half pressure

The research firm expects third-quarter pre-tax profit to decline by up to 3 percent quarter on quarter but rise 12 to 16 percent year on year. Time dotCom is scheduled to release its third-quarter results on November 27.

CIMB said higher equipment costs and marketing expenses could moderate margins. It also expects pre-tax profit growth of only 3 percent year on year in financial years 2027 and 2028 as the company shifts from capital expenditure toward operating expenditure during its migration to a Software-as-a-Service model. The first-half EBITDA margin was 47.9 percent, a level the company had indicated would moderate in the second half.

Business spans connectivity services

Time dotCom is a Malaysian telecommunications company serving consumer and business connectivity markets. Its investor-relations website lists Home Fibre, Time Business, Time Enterprise and Time Wholesale alongside Emit Solar and Time Charge N Go. The group also holds a 30 percent interest in AIMS, giving the investment case exposure to data-centre infrastructure.

Investors are also watching broader developments in current market reports.

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