KUALA LUMPUR: Mestron Holdings Bhd (MHB) targets to secure 180 telecommunication towers from the total 600 towers that are planned to be constructed in Sarawak under the National Digital Network (JENDELA) initiatives.
MHB, which has a strong track record in Sarawak, is expected to benefit from this as demand for its speciality pole products will surge.
Managing director Por Teong Eng said the company's strong presence in Sarawak gives an advantage.
"We have a proven track record of delivering on our products and services. We have been supplying to the majority of the contractors in Sarawak.
"This put us in a good position to win more contracts for works related to the development of these telecommunication towers," Por said in a statement today.
Under the first phase of JENDELA's Action Plan which will run until the end of 2022, a total of 1,661 towers will be built through open tenders in rural areas nationwide.
This will be done through the appointment of designated universal service provisions (DUSP) beginning from the fourth quarter (Q4) this year to boost 4G coverage to 96.9 per cent in populated areas by the end-2022.
Sarawak alone would require 600 towers under this program.
Poh said MHB will see massive earnings growth over the next two years with these projects, and given that the gross margin range at around 25 per cent, this will keep the company on a strong growth trajectory in the near term.
JENDELA's fourth-quarter report ended 30 September 2021 (FY21) shows strong work progress, which has exceeded its quarterly targets and remains on track to meet its quarterly and inclusive targets with the committed support of the industry players and relevant stakeholders.
As of 30 September 2021, the 4G mobile coverage has expanded from 91.8 per cent to 94.03 per cent of all populated areas, while mobile broadband speed has increased from 25Mbps to 31.34 Mbps.
Out of the targeted 7.5 million premises, about 6.4 million premises nationwide now have access to fibre broadband.
JENDELA aims to retire the 3G network by end-2021 to strengthen the 4G network.
Por believes that the strong progress by JENDELA to boost 4G connectivity, coupled with the retiring of the 3G network and faster rollout of 5G services nationwide will drive demand for the company's speciality pole products such as high mast and telecommunication monopole that is vital for the development of telecommunication infrastructure.
On top of that, the government has allocated RM7.7 billion through JENDELA to prepare Sabah and Sarawak for the switch to 5G technology with RM3.61 billion channelled to Sabah and RM4.09 billion to Sarawak.
With the faster progress by JENDELA, the 5G planning and implementation of commercialisation has been brought forward to the first phase from the second phase previously.
The development of the 5G telecommunication infrastructure offers another growth opportunity for MHB, which is already an established player in Sarawak.
"We're excited to be a part of the development of the telecommunication infrastructure in Malaysia to help bridge the digital divide between rural and urban areas.
"We're confident that together with the government and other stakeholders in the industry, we will provide ubiquitous high-quality and comprehensive access to digital infrastructure for all Malaysians," Por said.