MTN, Africa’s largest telecommunications company, has taken another giant step forward. The company is re-strategizing not only as a telecommunications company but also as a technology company.
The brand officially changed its Logo of white, yellow, and red lettering to a black-lettered MTN logo surrounded by an oval and similar in shape to a Ruby ball.
The Chief brand strategist revealed that what inspired the campaign is “an insight that doing is a bridge between can and done.” He said this is “because all progress comes from action.” Speaking on the refreshed brand identity, he noted that MTN’s new look aligns with its evolution from a telecommunications company to a technology company.
MTN’s transformation into a technology company positions it to remain one of Nigeria’s largest corporations. Aside from telecommunications products, it will also offer various other services. According to Nompilo Morafo, MTN Group’s Chief Sustainability and Cooperation Affairs Officer, this new development is set to go live on February 27.
This Telecommunication new look branding is part of the group’s Ambition 2025″ Strategy, which aims to create a leading digital Platform for African innovation and progress. According to Nompilo Morafo, She stated that the new look is aligned with the brand evolution and transition to being a Tech Company that is aligned by one simple and consistent yet sticking brand.
The expansion idea to become a full-fledged Technology service company means that the brand is looking to hire about 150 digital experts in South Africa, therefore looking for UI and UX designers, Product owners, Performance, marketers, Digital content specialists, E-commerce experts, Full stack developer, Scrum Masters, and Business Analysts. In addition, active fintech subscribers increased by 4.8 million to 9.4 million. Analysts predicted that earnings in 2022 will be “driven by growth in voice, data, and fintech income, as well as greater operational efficiency” according to analysts.
According to analysts, MTN Nigeria’s net profit might increase 34.5 percent to N401.58 billion in 2022, equating to earnings per share of N19.73, up from N14.67 in 2021, based on the current earnings report and outlook. According to analysts, based on the 2022 profits forecast, the dividend per share for the 2022 business year might climb by 34.5 percent to N17.64, up from N13.12 for the 2021 business year.
The projected dividend yield for 2022 is 10.4% based on the company’s recent public offer price of N169 per share and nearly nine percent based on its current market share price. According to analysts, MTN Nigeria trades at a price-earnings ratio of 10.0 times and an EV/EBITDA ratio of 4.8 times, compared to the emerging market peers’ averages of 20.7 times and 6.6 times.
“As a result, we raise our rating to ‘BUY’ from ‘HOLD,'” Cordros Capital stated. Analysts noted that MTN Nigeria added approximately one million subscribers following the alignment of its SIM registration and activation centres with regulatory guidelines. This trend is expected to continue with improved subscriber acquisition and forecast growth of 4.4 percent, bringing the company’s total customer base to 71.49 million in 2022.
Analysts predict that data revenue will continue to be a key driver of service revenue in 2022 as the company maintains its strong growth in data revenue, which increased by 55.3 percent to N516.21 billion in 2021.
“It is worth noting that MTN Nigeria acquired and activated an additional 800MHz spectrum in the first quarter of 2021.” Furthermore, the company was awarded the bid in a December 2021 auction to acquire a 100MHz spectrum licence in the 3.5GHz band to roll out 5G services. Management expressed confidence that 5G will provide the foundation for future network performance.
“Given that it is the only mobile network operator (MNO) to be awarded a 5G license, we believe this will give the company a competitive advantage over its peers.” Furthermore, we believe that the country’s favourable demographics, supported by a population estimated at 200 million people with a median age of 19, rising adoption of social media platforms for communication and digital marketing, and increasing internet penetration are key drivers of data revenue.
As a result, we anticipate a 26.5 percent increase in data revenue in 2022. Further out, we expect data revenue to increase by 25.7 percent on average from 2022 to 2026, with data revenue share rising to 43.2 percent in 2026 from 33.6 percent in 2022, according to Cordros Capital.
While network operating costs will remain high in the year due to the naira depreciation’s impact on BTS lease costs, the continued rollout of 4G sites to improve 4G coverage, and maintenance-related expenses, analysts predict that revenue growth and operational efficiencies will limit the overall impact on margins, with EBITDA margins rising to 53.6 percent in 2022 and averaging 54.8 percent between 2023 and 2026, peaking at 55.4 percent in 2026.
This is yet another great move by MTN, as the public perception concerning the brand will help improve and positively influence its market valuation. It will also offer a wide range of services such as Short films, video content popularly known as MTN short, music streaming, Social media services and Voice and Data Services.
In 2021, MTN valued its mobile money app at about $ 5 billion and mentioned that it’s considering a listing of that division; from its evaluation, it is believed that with more than 277 million subscribers across Africa, the brand will now be valued at 11 billion.
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