Vodafone Hutchison Australia, a unit of
Vodafone Group Plc
) recently announced the commercial launch of 4G Long Term
Evolution (LTE) services in Australia. The company has currently
deployed LTE services in key metropolitan cities, namely,
Adelaide, Brisbane, Melbourne, Newcastle, Perth and Sydney. Given
the growing market for hi-speed data services, we believe this
new venture would bring financial benefits to the company. In
addition, 4G LTE services will also generate significant market
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Apart from Australia, Vodafone is accelerating its 4G expansion
in many other countires like South Africa and other European
markets like Germany, Rome and Milan in Italy. The company has
over 400,000 LTE customers. Ongoing efforts to upgrade the
existing network infrastructure should result in higher network
efficiency and increased mobile data capacity. The company is
also working on spectrum acquisitions and secured spectrum
licensing in the Netherlands, Ireland and India. The company also
won the U.K. 4G spectrum auction in the 800MHz and 2.6GHz ranges.
Vodafone group, the second largest telecom carrier following
China Mobile Limited
) is continuously gaining share in the majority of its markets on
strong adoption of data services and migration to smartphones.
The company's future growth hinges on key drivers like increasing
mobile data services, growth in enterprise markets through
converged fixed and mobile services (Vodafone One Net). Further,
new pricing plans such as Vodafone Red, growth in emerging
markets, growth in machine-to-machine, near-field communications
and mobile financial services, as well as maintaining liquid
investment in quality networks would also be accretive.
Further, we believe the re-structuring of enterprise business
into one unit, Vodafone Group Enterprise and integration of Cable
& Wireless Worldwide will enhance its product portfolio and
tap opportunities in large and medium-sized businesses.
Consistent with the company's plan to expand its Enterprise
segment, in Feb 2013, Vodafone inked a multi-year contract with
BAE Systems plc, which deals in defense, aerospace and security
business to supply mobile communication worldwide. The agreement
remains accretive to the company's global enterprise customers
while promoting its security products and services.
Vodafone operates with the likes of
Liberty Global Inc.
) and carriers a Zacks Rank #3 (Hold).