Contactel (50% owned by Ceske radiokomunikace) could delay the extension of fixed-line voice services due to unclear regulatory framework and tightened profit margins. We value Ceske radiokomunikace’s stake in the company at zero, and we believe this to be the majority opinion on the market. The information should not therefore influence Ceske radiokomunikace stock. While the news of prospectively decreasing pressure from competitors is positive for Cesky Telecom, the stock is unlikely to react.
(Jiri Soustruznik)