AXIATA GROUP BERHAD (AXIATA)

Axiata Group Berhad - More Than a Telco

Many investors misread Axiata. They see "telecommunications" in the name and assume it is a company that runs phone networks. In reality, Axiata is a holding company and regional conglomerate - it does not operate its own telecoms networks directly in full, but instead holds equity stakes in multiple telecom operators and digital assets across Asia.

Think of Axiata as a sophisticated institutional investor that owns significant stakes in several large companies. Revenue flows not from subscriber bills, but from dividends paid upstream by its operating subsidiaries to Axiata as the parent holding company. In FY2025, Axiata received RM1.7 billion in dividends from its operating companies (OpCos) - that is the real financial engine of this business.

Strategic Portfolio Holdings

Axiata holds interests in eight core entities across Asia:

• CelcomDigi (Malaysia) - 33.1% equity: The merged entity of Celcom and Digi, Malaysia's number one mobile operator. Axiata does not consolidate CelcomDigi in group accounts - it is equity-accounted. In FY2025, Axiata received RM574.7 million in dividends from CelcomDigi.
• XLSMART (Indonesia) - 66% equity: The merged entity of XL Axiata and Smartfren, completed April 16, 2025. XLSMART is now Indonesia's third-largest operator with 94.51 million subscribers and approximately 27% market share. Axiata received USD475 million in cash from the transaction (USD400 million from new investors + USD75 million contractual payment).
• Dialog Axiata (Sri Lanka) - ~82% stake: Fully consolidated. FY2025 PATAMI +66.7% YoY - a strong recovery following Sri Lanka's economic crisis.
• Robi Axiata (Bangladesh) - ~62% stake: Fully consolidated. FY2025 PATAMI +33.3% YoY.
• Smart Axiata (Cambodia) - ~67% stake: Fully consolidated. FY2025 PATAMI +5.9% YoY.
• Edotco Group (tower infrastructure) - 63% stake: A strategic infrastructure asset providing tower co-location services across the region. FY2025 EBITDA margin hit a record 74.1%. This is Axiata's "hidden gem" asset currently in the process of a major monetisation event.
• Boost (fintech) - ~100% stake: A digital finance platform still in growth mode. Losses are narrowing and the onboarding of a new strategic shareholder is pending regulatory approval.
• ADA (digital marketing & analytics) - ~100% stake: FY2025 EBITDA +30.9% YoY - strong growth in corporate data and digital marketing services.

Strategy Transition: From 5x5 to Axiata28

Axiata has just completed its "5x5 Strategy" (2020-2025), which focused on balance sheet repair and portfolio restructuring. The company now enters a new era with the "Axiata28: Advancing Asia" strategy (2026-2028), centered on disciplined capital allocation, sustainable dividend growth, and digital leadership across the region.

Shariah Compliance Status ✅

Axiata Group Berhad is a Shariah-compliant stock listed under the Securities Commission Malaysia's Shariah Advisory Council. Investors seeking halal investment options can participate with confidence.

Key markets: Malaysia, Indonesia, Sri Lanka, Bangladesh, Cambodia - a company that genuinely represents "Advancing Asia".

AXIATA's quarterly revenue trend shows a clear currency-translation drag - reported revenue has been falling even as underlying (constant-currency) demand rises.

For 1H FY2026 overall: revenue of RM5.67 billion (down 3.2% reported, up 7.3% at constant currency), reported net profit of RM316.32 million, while underlying PATAMI more than doubled to RM717.2 million.

Alongside its 2QFY2026 results, AXIATA declared a first interim FY2026 dividend of 5.5 sen per share - up from 5.0 sen in the prior corresponding period (roughly +10% YoY). This follows an FY2025 total dividend of 10.0 sen per share (two interim dividends of 5.0 sen each).

Notably, this higher dividend declaration came alongside a weaker quarterly net profit (RM42.5 million, down from RM270.8 million a year earlier) - a signal that management remains confident in the company's cash generation even as accounting profit was pressured by non-cash/FX items.