Shares in South African fixed-line operator Telkom rose over 4% to touch a record high on Monday as investors expected good results from mobile operator Vodacom, in which the group owns a 50% stake.
Telkom releases its annual earnings on Wednesday, which is also when the mobile operator said it would provide details of its annual performance.
”We are expecting very good results out of Vodacom,” a Johannesburg-based trader said.
Vodacom, which dominates its home market but lags rival MTN across Africa, last month said operating profit rose to R10,9-billion in the year to end-March, while revenue climbed 21% to R41,1-billion.
Analysts expect state-controlled Telkom to post headline earnings per share of about R1 820,1 for the year to end-March, up 4,6% on the year before, according to Reuters Estimates.
While Telkom’s core fixed-line business is faltering in the face of stiffening competition, some analysts are betting the company will sell its stake in Vodacom to joint owner Vodafone, which would be a reason to hold on to the stock.
At 9.27am GMT, Telkom was up 2,6% at R180,70, after earlier reaching as high as R186,35, while the JSE blue chip top-40 index was up 0,73%. – Reuters