• Login
NORVANREPORTS.COM |  Business News, Insurance, Taxation, Oil & Gas, Maritime News, Ghana, Africa, World
  • Home
  • News
    • General
    • Political
  • Economy
  • Business
    • Agribusiness
    • Aviation
    • Banking & Finance
    • Energy
    • Insurance
    • Manufacturing
    • Markets
    • Maritime
    • Real Estate
    • Tourism
    • Transport
  • Technology
    • Telecom
    • Cyber-security
    • Cryptocurrency
    • Tech-guide
    • Social Media
  • Features
    • Interviews
    • Opinions
  • Reports
    • Banking/Finance
    • Insurance
    • Budgets
    • GDP
    • Inflation
    • Central Bank
    • Sec/Gse
  • Lifestyle
    • Sports
    • Entertainment
    • Travel
    • Environment
    • Weather
  • NRTV
    • Audio
    • Video
No Result
View All Result
No Result
View All Result
NORVANREPORTS.COM |  Business News, Insurance, Taxation, Oil & Gas, Maritime News, Ghana, Africa, World
No Result
View All Result
Home Business

5G investments to test Chilean telco financial flexibility and leverage

4 years ago
in Business, highlights, Home, home-news, latest News, Technology, Telecom
2 min read
0 0
0
122
VIEWS
Share on FacebookShare on TwitterShare on Linkedin

5G investments to test Chilean telco financial flexibility and leverage

Chilean telecommunication companies’ financial flexibility will be tested by investments in 5G and fiber optic networks, with issuers’ level of investment dependent on their financial strength and ability to divert resources towards fifth generation wireless communication, says Fitch Ratings.

We expect investments to be funded with cash, asset sales and additional debt, which could increase net leverage and pressure companies’ credit profiles.

5G technology will transform the Chilean telecommunications sector from one focused solely on voice and data into one with a more diversified suite of applications and services, including virtual reality/augmented reality/gaming, video calls/virtual meetings, wearables, mobile cloud computing and industrial automation. The features of 5G networks will also materially improve the experience of consumers currently receiving service from operators.

However, we expect the pricing power of Chilean operators to be challenged in the consumer segment due to significant competition, low customer awareness of the benefits of 5G technology and uncertainty regarding the degree and speed of 5G-enabled handset adoption. These factors will likely delay the return on investment for operators.

Regulators and industry sources estimate 5G investments of USD4 billion to USD14 billion in aggregate from 2021 through 2025. The initial investment totalled USD450 million and was made during the spectrum auction this year, which more than tripled overall spectrum assigned at the national level.

Empresa Nacional de Telecomunicaciones, S.A. (ENTEL, BBB-/Stable), Telefonica Moviles Chile S.A. (BBB+/Stable) and WOM S.A. (BB-/Stable), among others, were awarded spectrum blocks and have three years to put the technology into operation.

RelatedPosts

From Promise to Peril: How Exam Fraud is Eroding Ghana’s Educational Soul

The 10 Fastest-Growing Trading Nations in Africa

Nigeria’s 1.6 Million Container Trade Far Less Than it’s Ports Potential – Logistics Expert

WOM, which was awarded the largest number of spectrum blocks, announced investments of around USD450 million to USD500 million over the three-year period ending in 2023. These investments represent around 50% of Fitch’s projected capex for WOM for the 2021-2023 period.

The company recently issued a USD450 million senior bond that strengthened its liquidity and helped prepare it for increased spending. WOM is also exploring a potential sale of towers, which would strongly support liquidity and strengthen its ability to finance 5G and fiber optic network investments.

Read: SMP Directives Compliance: MTN implements on-net and off-net parity measures

We expect ENTEL and Telefonica’s investments in 5G to be between USD 200 million and USD300 million over the three-year period ending in 2023 or around 15% to 20% of our projected capex for these companies. ENTEL’s financial flexibility is solid, due in part to improved operational performance and a tower sale in 2019 leading to CLP527 billion of liquidity at the end of June 2021.

Leverage metrics will be pressured by the 5G and fiber investments for all the awarded operators but are expected to remain at or below Fitch’s negative rating sensitivity over the rating horizon.

We expect Telefonica’s net leverage to increase to around 2.0x by 2023, above the historical average of around 1.0x, due in part to cash used for 5G investments. Factors that would allow Telefonica to face material investments in 5G without affecting its credit rating include dividend flexibility to its parent and its ability to reduce capex allocated toward other items.

Source: fitchwire
Via: norvanreports
Tags: 5G investments to test Chilean telco financial flexibility and leveragemobile cloud computing and industrial automation.video calls/virtual meetingsvirtual reality/augmented reality/gamingwearables
No Result
View All Result

Highlights

Inside Details of Presco’s $172m Acquisition of SOP, Ghana Oil Palm Firm

Africa’s Richest Economy’s Currency Hits Nine-Month High as Fed’s Dovish Signal Weakens Dollar

Trump Weighs Using $2 Billion in CHIPS Act Funding for Critical Minerals

Moving Gold, Moving Economies: The Rise of Migrant Women in Zimbabwe’s Mining Sector

Senegal and Mercedes-Benz Partner to Build Trucks

INTERPOL Recovers Over $90 Million From African Crime Syndicates

Trending

Features

From Promise to Peril: How Exam Fraud is Eroding Ghana’s Educational Soul

August 23, 2025

From Promise to Peril: How Exam Fraud is Eroding Ghana’s Educational Soul In the heart of West...

The 10 Fastest-Growing Trading Nations in Africa

August 23, 2025

Nigeria’s 1.6 Million Container Trade Far Less Than it’s Ports Potential – Logistics Expert

August 23, 2025

Inside Details of Presco’s $172m Acquisition of SOP, Ghana Oil Palm Firm

August 23, 2025

Africa’s Richest Economy’s Currency Hits Nine-Month High as Fed’s Dovish Signal Weakens Dollar

August 23, 2025

Who we are?

NORVANREPORTS.COM |  Business News, Insurance, Taxation, Oil & Gas, Maritime News, Ghana, Africa, World

NorvanReports is a unique data, business, and financial portal aimed at providing accurate, impartial reporting of business news on Ghana, Africa, and around the world from a truly independent reporting and analysis point of view.

© 2020 Norvanreports – credible news platform.
L: Hse #4 3rd Okle Link, Baatsonaa – Accra-Ghana T:+233-(0)26 451 1013 E: news@norvanreports.com info@norvanreports.com
All rights reserved we display professionalism at all stages of publications

No Result
View All Result
  • Home
  • Business
    • Agribusiness
    • Aviation
    • Energy
    • Insurance
    • Manufacturing
    • Real Estate
    • Maritime
    • Tourism
    • Transport
    • Banking & Finance
    • Trade
    • Markets
  • Economy
  • Reports
  • Technology
    • Cryptocurrency
    • Cyber-security
    • Social Media
    • Tech-guide
    • Telecom
  • Features
    • Interviews
    • Opinions
  • Lifestyle
    • Entertainment
    • Sports
    • Travel
    • Environment
    • Weather
  • NRTV
    • Audio
    • Video

Welcome Back!

Login to your account below

Forgotten Password?

Create New Account!

Fill the forms bellow to register

All fields are required. Log In

Retrieve your password

Please enter your username or email address to reset your password.

Log In
NORVANREPORTS.COM | Business News, Insurance, Taxation, Oil & Gas, Maritime News, Ghana, Africa, World
This website uses cookies. By continuing to use this website you are giving consent to cookies being used. Visit our Privacy and Cookie Policy.
We use cookies to ensure that we give you the best experience on our website. If you continue to use this site we will assume that you are happy with it.