The telecom market regulator UKE has criticized TPSA’s proposal to replace the standard voice service subscription fee for clients wishing to use internet access service only, by an infrastructure maintenance fee, which would be only marginally lower than the original subscription fee. The regulator has threatened TPSA with PLN 100m fine, if it does not lower the maintenance fee. The company has replied that internet access services, which are not part of public telecom services, are not subject to direct price regulation.
Our view: The recent change on the post of CEO at TPSA has not brought any major change in the strained relationships between the telecom incumbent and the regulator. We view the news on another possible fine looming over TPSA as neutral for today’s trading. We reiterate our Hold rating for the stock.