Ethio Telecom shares upbeat forecast ahead of partial privatisation

Ethio Telecom shares upbeat forecast ahead of partial privatisation

In a very upbeat projection of its prospects for the near future, state-run operator Ethio Telecom has forecast a 19% rise in revenue over the June 2023-July 2024 financial year. It has also forecast a 29% rise in the number of customers on its network using its mobile money services.

Reuters notes that the company has estimated full-year revenue of 90.5 billion birr (about US$1.65 billion) and has said it aimed to increase its total subscriber numbers by 8% to 78 million; most of them (nearly 75 million) would be mobile phone customers. Users of its mobile financial service, Telebirr, are expected to rise 29% to 44.1 million, it said.

The company, which says it has been providing telecom services in the country for the last 129 years, is aiming for a total mobile service capacity of 92 million by end of the fiscal year.

That’s quite a target given the country’s population of a little over 120 million and strong competition from recent arrival Safaricom Ethiopia. There’s also the question of how a proposed third operator could affect the competitive landscape.

Nevertheless, these projections do appear to be part of an upward trend. As we reported last week, Ethio Telecom revealed a 2022-23 profit more than doubling (to around US$344 million) along with rising subscriber numbers.

These figures, along with the company’s latest projections, should make the prospect of partial privatisation in the form of a 45% stake sale in Ethio Telecom even more attractive to would-be bidders. Indeed, we have reported that a number of big names are said to be considering bids for the 45% stake.