KUALA LUMPUR — Axiata Group Bhd made a promise Monday. It was a big one, and it came with a number: RM1.8 billion.
That is the total payout the telco says it will deliver to shareholders by 2024, if it hits its target of 20 sen per share. The company has nine billion shares outstanding. The math is straightforward. The ambition is not.
This is not a near-term pledge. The 2024 goal sits at the end of a three-year runway. It represents a doubling of the 10 sen per share Axiata paid out for the 2020 financial year. That is a steep climb.
Chief executive officer Datuk Izzaddin Idris laid out the plan in the company’s Integrated Annual Report 2020, released Monday. He said the telco has shifted its focus. The goal now is to become a high-profit organization. That is a change in direction.
For years, Axiata was a growth story. It spent heavily to expand across Asia. It built networks in Malaysia, Indonesia, Sri Lanka, Bangladesh, Cambodia, Nepal. It took on debt. It chased subscribers. Now the message is different. The emphasis is on profitability. On delivering cash back to shareholders.
The shift reflects a broader reality. Telecoms globally face a squeeze. Revenue from voice calls is declining. Data prices are under pressure. Regulators are demanding more. Axiata is not immune. Izzaddin cited network capacity demand, consumer service expectations, and ongoing regulatory uncertainties as issues that are expected to continue. These are not going away.
The company has a plan to deal with them. It has allocated RM6.5 billion in capital expenditure to support growth and future readiness. That is a lot of money. But it is also a signal. Axiata is investing in its networks. It is betting that better infrastructure will drive higher profitability.
Izzaddin said the company’s robust financial and underlying fundamentals will support its defenses against current and future uncertainties. He talked about capturing emerging growth opportunities, accelerating digital transformation, and investing in new network infrastructure. All of that is meant to deliver on the high-profit expectations of shareholders.
The short-term picture is cautious. For 2021, Izzaddin said Axiata would maintain a balanced approach. He noted that ongoing global vaccination efforts could stabilize the crisis. But he warned that operating markets would need time to regain economic growth momentum. The pandemic is not over. The recovery will be uneven.
Axiata operates in multiple countries. Each has its own pandemic trajectory. Each has its own regulatory environment. That complexity makes the 20 sen target a real test. It is not just about Malaysia. It is about Indonesia, where competition is fierce. It is about Sri Lanka, where the economy is struggling. It is about Nepal and Bangladesh and Cambodia, where currency fluctuations can eat into profits.
The dividend target is a statement of intent. It says Axiata believes it can generate enough cash to pay shareholders twice what it paid last year. It says the company is willing to commit to that publicly. That is a risk. If it misses, the market will punish it. If it hits, the reward is credibility.
For now, the market will watch. It will track the capital expenditure. It will monitor the operating markets. It will wait for the quarterly results. The 20 sen target is out there. Axiata has to deliver.
