Grameenphone Limited (GP) is the largest mobile telecommunications operator in Bangladesh, boasting 84.83 million subscribers and a 44% of local market share as of 2023. The company was founded in 1996 and operates as a subsidiary of Telenor Group(Norway), which holds a majority share of 55.8%. GP has established itself as a key player in Bangladesh’s digital transformation, providing extensive mobile services, including 2G, 3G, and 4G, and expanding its reach through the deployment of innovative solutions such as IoT services.
Key Achievements as of 2023
Revenue: Reached BDT 158.7 billion, with a YoY growth of 5.5%.
Subscribers: Added 2.8 million new customers, increasing the subscriber base by 3.6%.
Investment: Allocated BDT 33.1 billion towards infrastructure development, including over 1,600 new 4G sites, expanding 4G coverage to 97.9% of the population.
Profitability: Net profit rose to BDT 33.1 billion, reflecting a margin of 20.8%.
Digital Initiatives: Introduced IoT products, expanded the “MyGP” app ecosystem, and launched digital partnerships to enhance user experience.
Sustainability: Committed to reducing carbon emissions by 50% by 2030 and deployed over 1,200 solar-powered towers.
GP’s Quarterly financial performance reflects a mix of stability and challenges over the observed quarters. The company demonstrated consistent revenue growth until Q2’24, peaking at BDT 42,230 mn, supported by robust demand and operational stability. However, a dip in Q3 ‘24 to BDT 39,539 mn suggests due to operational challenges.
Operating profit remained healthy, although declining to BDT 14,639 mn in Q3’24, signaling rising cost pressures. Net profit and EPS followed a similar trajectory, peaking in Q1’24 at BDT 13,380 mn and BDT 9.91, respectively, but declining sharply thereafter, raising concerns about profit sustainability. To navigate these turbulent, GP should prioritize cost optimization, revenue diversification, and prudent financial management to sustain growth and protect margins.
GP maintains its dominant position due to robust investments in network infrastructure, customer-centric innovation, and digital service expansion. Despite facing challenges such as high taxation, regulatory hurdles, and a competitive market, GP’s focus on efficiency and service quality has solidified its market lead.
At the current market price of BDT 332.40 per share, GP appears undervalued compared to its intrinsic value of BDT 440.76 suggesting a potential upside of 32.6%. This margin of safety provides a significant opportunity for investors, especially if the company successfully navigates its current challenges and benefits from the anticipated expansion in its industry.