Nigerian Telecoms Industry Show Improving Fundamentals


Monday, September 02, 2019   /10:20AM  / CSL Research / Header Image Credit:

Last week, the Nigerian Communications Commission (NCC) released a flurry of July data for the telecommunications industry. The data published were broadly positive reinforcing our stance on the telecommunications industry being the bright spot of the weak economy. According to data published by the NCC, the number of mobile subscribers grew 0.5% m/m and 8.2% y/y to 174.7m subscribers while Internet subscribers grew 0.3% m/m and 18.3% y/y to 122.7m subscribers. Furthermore, broadband subscription grew 1.2% m/m and 33.6% y/y to 64.4m subscriptions in July while broadband penetration expanded to 33.7% in July 2019 from 33.3% in June 2019 and 25.3% in July 2018.

Breaking down the mobile subcribers numbers, MTNN remained the biggest player by subcribers with a subscriber base of 65.3m (37.4%) while Airtel Nigeria overtook GLO NG as the second largest player by subscriber base with 46.8m subscribers (26.8%) compared to GLO NG's 46.7m subscribers (26.7%). Meanwhile, 9mobile extended its 4-month streak of losing subscribers with its subscriber base now at 15.7m (9.0%) from 16.4m at the start of the year.

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The reasons for the strengthening fundamentals in the telecommunications industry are not far-fetched with broadband penetration still at 33.7% and 4G coverage below 30.0%. Operators within the industry have invested heavily in network infrastructure across the country in bid to spread 3G/4G bandwith coverage. Furthermore, the increasing use of smartphones aided by a young population demographic has helped raise the number of internet and mobile subscribers. An increasingly digitised economy and rapid urbanisation remain some of the key factors influencing indutsry growth. Going forward, we expect sustained growth across the telecoms industry KPIs at least in the medium term. Thus, we expect this would feed positively into the performance of key listed telecoms operators.

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