Dubai: After adjusting for the new UAE royalty rates for telcos, NBK Capital estimates that Etisalat will pay an average effective tax rate of 51 per cent on its profits for the next three years. Reckons the telco will pay 49 per cent for 2012 and 46 per cent in 2016. Resumes coverage on Etisalat with a price target of Dh12.5 and a buy rating. Expects Etisalat group revenues and ebitda to grow at an average annual rate of 3.2 per cent and 1.9 per cent, respectively, between 2012 and 2016, driven by its international operations, particularly in Africa.
Says UAE profit margins will slowly decline and international operations will eventually contribute a third of revenues and 22 per cent of ebitda in 2016, from 30 per cent and 18 per cent respectively last year. Forecasts 4Q revenues of Dh8.2 billion and net profit of Dh1.78 billion. Expects a dividend payout ratio of 62 per cent for FY2012.
