Amx - Ic Initiation of Coverage - 12182014

INITIATION OF COVERAGE
Amrica Mvil
BBI Equity Research
Thursday, December 18, 2014
Regulatory Concerns Tarnish AMXs Shine

Amrica Mvil
We are initiating coverage of Amrica Mvil, with a Market Perform rating and a TP (AMXL/AMX)
of P$18.00 for AMXL (US$26.80 per ADS), representing upside of 13.6% based on Telecom
our DCF. In our view, despite being a leader in the Latin American telecom market, AMX
justifies a lower valuation due to regulatory headwinds in some of its main operations Market Perform
(such as Mexico and Colombia) combined with slower organic growth. AMX is trading at
an EV/EBITDA15E multiple of 5.6x, below its international peers average of 6.5x. We Target Price: P$18.00 / US$26.80
Upside: 13.6% / 23.7%
project that AMX should post EBITDA CAGR for 2015-17 of 2.2% (or 6.0% in constant
currency), vs. its international peers average of 5.4%. At our TP, AMX would trade at an
EV/EBITDA15 of 6.0x. 130
125
Amrica Mvil has a dominant position in the Mexican telecom market, with market 120
share of ~62% in fixed telephony and broadband and wireless, as well as the countrys 115
largest and best-quality network. In 2013, Mexican telecom regulator IFT ruled that the 110
company was a preponderant economic agent, subjecting it to asymmetric rules (such 105
as price, unbundling, infrastructure sharing, etc.) vs. its competitors. Thus, AMX decided 100
95
to sell some assets (not disclosed yet), and plans to spin off its tower business, the latter
90
of which we expect to unlock about P$0.23 for our TP for AMX, considering that tower
85
companies trade at higher multiples than telecom carriers. However, we do not assume
80
the sale of assets in our model, due to a lack of visibility on this strategy. Dec-13 Feb-14 Apr-14 Jun-14 Aug-14 Oct-14 Dec-14
Mexbol America Movil

Besides taking advantage of migration of traffic from fixed to mobile (the latter of
which accounts for ~62% of AMXs service revenues), the company may take
advantage of low broadband and pay TV penetration in Latin America. The company
has been posting strong growth in some markets like Brazil, thanks to its strategy of
investing to provide bundles (triple and quadruple play) in new cities. We believe that in
COMPANY REPORT
2015, growth from Latin American operations ex-Mexico may offset declining revenues
and EBITDA in the Mexican operation.
The company has recently increased its stake in Telekom Austria (TKA) to 60%, not
only giving AMX control of Telekom Austria, but also allowing it to use TKA as its
vehicle to expand its presence in Europe. TKA is already operating in 7 Eastern
European countries, and has opportunities to invest in upgrading the network to provide
Luis Azevedo -
55 11 2178 5321
luis.azevedo@bradescobbi.com.br
better broadband plans and bundles, as well increase profitability through cost-cutting.
Tales Freire, CFA -
55 11 2178 4527
We believe AMX may also benefit from some positive impacts from potential market tales@bradescobbi.com.br
consolidation in the countries where it operates (i.e. Brazil). However, we should
point out that this impact should not be so meaningful for AMX, since the Brazilian
operation accounts for just 18% of the companys EBITDA.
In our view, AMX enjoys a sound financial position, with net debt/EBITDA of ~1.6x,
which could decrease even more should the company succeed in selling assets in Mexico.
We expect the company to generate a FCFE yield of 5.0% for 2015, with a total yield of
6.7%, through dividends and/or share buyback.
(MXN mn) 2013A 2014E 2015E 2016E Key Figures 18-Dec-14

Net Revenues 786,100 843,920 876,390 879,831 Local price 15.84
EBITDA 255,698 271,161 284,278 286,804 ADR 15.84
EBITDA Margin 32.5% 32.1% 32.4% 32.6% Price range - 52 weeks (P$) 12.39 - 17.64
Net earnings 74,621 67,746 89,393 90,246 Shares outstanding (mn) 69,100
EPS (P$) 1.08 0.98 1.29 1.31 3-month ADTV (P$mn) 1,057.2
P/E 14.7 16.2 12.2 12.1 Market cap (P$mn) 1,094,544
EV/EBITDA 6.2 5.8 5.6 5.5 EV (P$mn) 1,585,144
ROE % 35.5% 31.9% 35.4% 33.4% Net debt (P$mn) 490,600
Dividend yield % 7.9% 4.9% 6.5% 6.6% Net debt/EBITDA14 1.8
Bradesco Corretora Av. Paulista, 1.450 7th floor Sao Paulo Brazil 55 11 3556-3001
Bradesco S.A. Corretora de Ttulos e Valores Mobilirios (Bradesco Corretora) does and seeks to do business with companies covered in its research reports. As a result, investors should be aware that
Bradesco Corretora and its affiliates may have a conflict of interest that could affect the objectivity of this report. Investors should consider this report as only a single factor in making their investment decision.
For full disclaimer and definitions, please refer to the end of this report. Not for distribution in the United States, Canada or Japan or to U.S. persons.
COMPANY REPORT
BBI Equity Research Thursday, December 18, 2014
Contents Page
Investment Thesis ...................................................................................... 3

Risks .......................................................................................................... 7
Multiples Analysis ...................................................................................... 9
Company Description ............................................................................... 11
Mexico .................................................................................................. 15
Market Overview ............................................................................... 16
Recent Regulatory Changes ............................................................. 18
Consolidation Events ........................................................................ 21
Spinning-off the Tower Business ...................................................... 22
Asset Sales ....................................................................................... 23
Estimates .......................................................................................... 24
Brazil .................................................................................................... 26
Market Overview ............................................................................... 28
Recent Regulatory Changes and Consolidation Events ................... 30
Estimates .......................................................................................... 31
Colombia .............................................................................................. 32
Market Overview ............................................................................... 33
Estimates .......................................................................................... 34
Telekom Austria ................................................................................... 35
Market Overview ............................................................................... 37
Recent Regulatory Changes and Consolidation Events ................... 39
Estimates .......................................................................................... 39
Central America and the Caribbean (CAC) .......................................... 40
Argentina, Paraguay and Uruguay (APU)............................................. 41
Ecuador ................................................................................................ 42
Market Overview ............................................................................... 43
Estimates .......................................................................................... 43
Peru ...................................................................................................... 44
Market Overview ............................................................................... 45
Estimates .......................................................................................... 46
The United States ................................................................................. 47
Chile ..................................................................................................... 48
Market Overview ............................................................................... 49
Estimates .......................................................................................... 50
Valuation .................................................................................................. 51
Key Figures .............................................................................................. 52
2
COMPANY REPORT
Investment Thesis
AMX enjoys a leading position in Latin America, with strong presence in the largest
economies (Brazil, Mexico and Colombia). AMX is the preponderant player in Mexico,
with a market share of more than 60% in the fixed and mobile business. In Brazil, the
company is fighting for leadership of the Brazilian market with Telefnica Brasil, and has
a ~24% share of revenues in the market. On the top of that, the company has a
comprehensive footprint in most countries in Latin America, with approximately 340mn
RGUs in the region. We believe this strong presence and size ensures massive scale and
profitability for AMX.
Figure 1: AMX Market Share in Mobile Segment
70.0%
66.0%
58.0%
40.0% 41.0%
35.0%
29.0%
25.0%
22.0%
7.7%
MEX COL BRA CHL ECU APU PER CAC USA AUT
Source: Company, Anatel, IFT, Subtel, MinTIC, Supertel, OSIPTEL, CTIA and Bradesco Corretora
Includes Argentina, Paraguay and Uruguay
Includes Central America and Caribbean countries
Only in the prepaid segment
In our view, AMXs solid balance sheet and robust cash flow generation have
paved the way for an extensive track record of acquisitions, and M&A will likely be
a main feature of the company. Market leadership and strong EBITDA margin in Mexico
have made the country a great cash cow for the company, with AXM having taken
advantage of this cash flow to make several acquisitions in various Latin American
countries over the past 15 years. More recently, the company has taken advantage of the
economic slowdown in Europe to find opportunities to invest in the region. AMXs latest
investment was in Telekom Austria, buying a 59.7% stake for an EV/EBITDA14 multiple
of 5.4x. The company also has a relevant 21.4% stake in Koninklijke KPN, but has been
gradually reducing it, having not succeeded in acquiring control of the company.
Figure 2: AMX Global Positioning (ex. China)
#8
#7
#2 #2
#1
Total Access Wireless Revenues EBITDA Free Cah

Subscribers Flow
Source: Company and Bloomberg
3
COMPANY REPORT
We expect the company to continue to invest heavily in improving its market share
and competitive position in the regions where it already has robust operations. One
example is Brazil, where the company has carried out a heavy investment cycle over the
past three years, equivalent to 30% of the countrys investment in the telecom sector. As
a result of the major investments, the company has posted the fastest growth rate among
the largest telecom companies, and created opportunities for EBITDA margin expansion.
The company plans to invest US$10bn per year between 2011 and 2015, and we expect
capex to stay at this level in the subsequent years to sustain top-line growth.
Latin America still has low penetration of broadband and pay TV in comparison to
more-developed countries, which should represent good growth prospects for AMX, as
penetration of these services increases throughout the continent especially considering
AMXs sizable investment capacity (robust balance sheet). We expect growth stemming
from AMXs position in Latin American countries (excluding Mexico) to offset any decline
in the Mexican operation due to a tougher regulatory environment.
Figure 3: Fixed Broadband Penetration per 100 Inhabitants - 2013 Figure 4: Pay TV Penetration per 100 Inhabitants - 2013
Latin America BRICS Developed Countries Latin America BRICS Developed Countries
39% 38%
35% 36%
33%
31%
29% 29% 29%
26% 27%
25%
22%
20% 20%
17%
14% 14% 14%
12% 12% 13%
11% 12%
9% 10% 9% 9%
3%
1%
ARG MEX CHL COL BRA RUS IND CHN ZAF CAN USA FRA DEU ITA GBR JPN ARG MEX CHL COL BRA RUS IND CHN CAN USA FRA DEU GBR JPN
Source: ITU and Bradesco Corretora Source: Bradesco Corretora
We believe AMX will be able to change its preponderant player status in Mexico by
selling part of its operation, increasing competition and no longer having
asymmetric rules. In this case, we believe the company would analyze what would be
the best assets to sell, and under which conditions, in order to maintain part of its current
competitive advantages. In our view, AMX would maintain its leadership in Mexico and
important competitive advantages such as coverage, quality and very good distribution
chain through more than 21.5k points of sales throughout the country with the Telcel and
Telmex brands. In addition, we expect the company to continue enjoying a very strong
position in providing services to the corporate segment, thanks to its better coverage and
footprint in fixed and mobile services, as well as robust infrastructure to provide corporate
data services. Nevertheless, in our model we do not assume the company selling its
assets and no longer being subject to asymmetric rules.
We envisage the spin-off of the tower business unlocking value for AMXs
shareholders, due to simple multiple arbitrage, and we assume it in our estimates.
Tower companies usually trade at richer multiples than telecom operators. Although the
return provided for the tower business is still unclear, we could imagine that this company
could have the opportunity to create value by increasing the number of tenants per tower.
Supposing that AMX does not have the practice of sharing its towers, and assuming that
the new company would be able to increase the number of tenants per tower, we could
see the new tower company having a valuation similar to that of tower companies, or at
least at a valuation based on most-recent transactions. In these cases, we could see the
tower company having a valuation of US$3.25bn to US$3.5bn, while based on the
4
COMPANY REPORT
EV/EBITDA multiple at which the company is currently trading, the towers are being
valued at only US$1.2bn. Therefore, we believe the spin-off could add up to US$2.3bn in
value to AMXs shareholders, assuming a multiple per tower of US$250k. In our model,
the spin-off of towers adds US$1.7bn (1.8% of our TP).
In our view, AMX should be able to enter the pay TV market in Mexico after fulfilling
regulator IFTs requirements, although we do not assume it in our model. In our
view, AMX may become a very strong player in this market, as it already has a solid base
of broadband and fixed telephony customers, and for these customers it would be very
convenient to subscribe to all telecom services through a single package from a single
provider. Meanwhile, AMX would be very competitive in terms of pricing, as it already has
the required infrastructure and competitive agreements with content providers. In
addition, we point out that AMX has considerable expertise in the pay TV segment due to
its operations throughout Latin America. For example, it is the leader in the Brazilian
market. Finally, AMX could take advantage of buying pay TV content with scale, and
optimize its infrastructure, such as satellites and fiber network.
AMX has acquired control of Telekom Austria, unlocking opportunities to expand

its presence in Europe. Not only is Telekom Austria the leading carrier in Austria, but it
also has sizeable presence in various Eastern European countries (such as Bulgaria,
Croatia, Serbia and Belarus). The company has recently conducted a 1bn capital
increase to upgrading its fixed and mobile networks, and plans to enhance its bundling
strategy with a more robust fixed broadband package (above 30 Mbps). In addition,
Telekom Austria, which already has an EBITDA margin of 34%, foresees opportunities of
cost cuts (in 2014, it is cutting about 100mn in capex and opex), which should contribute
to operating margins expanding even more. We believe AMX may use TKA as a vehicle
to continue making acquisitions in the region, should it find attractive M&A opportunities.
AMX has low indebtedness and strong free cash flow generation, enabling it to
have one of the highest credit ratings among major telecom companies, plus low
cost of debt. The company has an A2 rating from Moodys, an A- rating from Standard
and Poors, and an A rating from Fitch. The good ratings have enabled the company to
have a very low cost of debt, which was approximately 4.8% per year in Mexican pesos in
2013. In light of the low cost of funding in capital markets, the company usually
concentrates the issue of new debt in its parent company, and lends to its subsidiaries in
other countries, thus having low cost of debt throughout its operations. AMX ended 3Q14
with a net debt/EBITDA LTM of 1.63x (pro-forma including TKAs results), which is one of
the lowest ratios among major telecom companies, and very close to the benchmark of
1.5x that the company believes is a comfortable level to ensure the maintenance of its
current credit ratings.
Figure 5: Credit Ratings Among Major Western Telcos Figure 6: Net Debt/EBITDA ratio Among Major Western Telcos
Moody's Standard & Poor's Fitch
Amrica Mvil A2 A- A
AT&T A3 A- A 2.40 2.40 2.40
2.20
Verizon Baa1 BBB+ A-
2.00
Vodafone Baa1 A- BBB+
1.70
France Telecom Baa1 BBB+ BBB+ 1.60
Deustsche Telekom Baa1 BBB+ BBB+
Telefnica Baa2 BBB BBB+
Amrica AT&T Verizon Vodafone France Deustsche Telefnica

Mvil Telecom Telekom
Source: Company and Bloomberg Source: Company and Bloomberg
5
COMPANY REPORT
The solid balance sheet will likely also enable AMX to maintain its share buyback
programs and continue seizing new investments opportunities, in our view. The
company has been quite active in share buyback programs, having acquired 8.4bn
shares or ~11% of its base in the past three years. Furthermore, as we expect the
company to generate US$4.9bn in free cash flow to equity in 2014 (yield of 6.6%), we
believe the company should continue remunerating its shareholders through share
buybacks. We estimate the company distributing to its shareholders 80% of its net
earnings through share buybacks and dividends in the coming years, a level similar to
that for the past three years. This should represent total yields of 6.5% for 2015 and 6.6%
for 2016, which is one of the largest among the Latin American telecom companies under
our coverage.
Figure 7: Share Buyback/Dividend Yield

7.9% 7.6%
7.1%
6.4% 6.5% 6.6%
87 4.9% 84
78
70 3.0% 72 72
54
33
2011 2012 2013 2014e 2015e 2016e 2017e 2018e
Distribution Yield
Source: Company and Bradesco Corretora estimates
The telecom sector has been experiencing a consolidation wave in Europe and the
Americas, and we believe consolidation may increase the sectors profitability,
being a likely upside potential for AMX. In the past year, global telecom operators
have enjoyed positive performance, and we believe one of the reasons was expectations
of market consolidation. The German and Austrian mobile markets experienced
consolidation through the merger among the four largest players, while there have been
several other rumors of market consolidation in Europe. In Latin America, there have
been great expectations of consolidation in the mobile segment in Brazil, with an
acquisition or merger between the second and fourth-largest players. Meanwhile, in the
fixed business, Telefnica Brasil announced the acquisition of GVT, one of the largest
fixed broadband providers. Should there be consolidation moves in the countries where
AMX has operations, we believe it is very well positioned to participate as a key player,
including in Brazil, which could result in huge synergies thanks to a more rational
competitive environment and greater economies of scale.
6
COMPANY REPORT
Risks
In our view, AMX has the natural risks intrinsic to a telecom operator, such as:
technology risks, regulatory risks, and competition risks. In addition, as its
operations are more concentrated in Latin America, we also see some risks related
to FX variation and any economic slowdown in the countries where it operates.
Regarding regulatory risks, the company may suffer from constraints and
limitations on pricing for its services, high taxation, and other operational
limitations. One example of a recent regulatory headwind was the Mexican government
classifying AMX as a preponderant agent (with market share above 50%), imposing
asymmetric regulations for its fixed-line and wireless businesses, starting in 2014. The
regulations include: asymmetric interconnection rates, passive infrastructure sharing,
unbundling of the local loop, wholesale provision of dedicated links, elimination of
nationwide roaming charges, access to mobile virtual network operators, regulations on
service quality, and retail information requirements. In our opinion, these asymmetric
measures are having a material impact on the companys results and operations.
Therefore, AMX intends to sell part of its fixed and mobile businesses to reduce its
market share to below 50% and avoid being classified as a dominant economic agent.
Other regulatory risks are related to the duration of licenses and concessions, and
the risk of them not being renewed, or being renewed with more adverse
conditions. According to companys 20-F, the companys licenses and concessions are
usually for 5 to 20 years, and are usually renewed after the payment of a fee. However,
renewal is not guaranteed, and the company is currently facing renewals in Chile and
Colombia.
We view technological changes as another sector risk, as they can alter the
sectors dynamics very quickly. Telecom vendors are always developing and providing
new technologies, some of which may bring considerable profitability, and others may not
have scale to become competitive. AMX always will have the challenge of being able to
continue investing and choosing the technologies that will keep it competitive.
We also see competition as a risk factor, especially in regions where there are
many players with a more balanced market share breakdown. In our view, AMX
enjoys good market positioning in most of the markets where it operates. Nevertheless,
we point out the risk of competition becoming tougher, which could affect pricing policy,
and require greater investments and handset subsidies. We point out that the
telecommunication sector is undergoing a wave of global consolidation, creating larger
and more competitive companies, which may become competitors in AMXs main
markets. For example, AT&T has recently announced its bid to acquire Iusacell, the third-
largest mobile player in Mexico, a move that is being assessed by regulators. AT&T is
also analyzing the possibility of acquiring America Mvils assets for sale, as well as
bidding for Nextels assets in Mexico. We also point out that Mexicos recent asymmetric
rules have helped Telefonicas operation in the country improve its operating margins,
and may strengthen its position in this market.
As a multinational company with exposure in some developing markets, AMX may

suffer from economic volatility in those markets. We believe this could adversely
affect the companys results in many ways, such as simple FX volatility (as the company
operates in many different currencies), but also being subject to any political instability,
which may lead to control of capital, etc. We point out that, Amrica Mvil presents its
results in Mexican pesos, operations outside of Mexico and denominated in other
currencies represent 65% of the companys net revenues and 55% of its EBITDA.
7
COMPANY REPORT
Moreover, most of AMXs debt is denominated in foreign currencies. Moreover, even

considering the impact of derivative transactions, FX changes can lead to large exchange
rate gains or losses. AMX held ~14.0% of its debt in P$490bn (unhedged) and has
exposure to US$ in 2013.
AMXs shareholder structure is somewhat complex with more than one class of
shares, in our view, and there is a corporate governance risk of conflict of interests
between controlling shareholders and minority shareholders. AMX is a holding
company controlled by the Slim family, and has operations in many subsidiaries around
the world. There may be some situations in which a decision by the controlling
shareholders or the parent company may conflict and not be completely aligned with
minority shareholders or shareholders of affiliate companies.
We also point out that AMX has executed many M&A transactions, and may
continue to do so in the future. We believe that M&A could become a risk factor
should the company overpay or not deliver the expected growth or profitability on
acquired assets.
8
COMPANY REPORT
Multiples Analysis
AMX is trading at an EV/EBITDA15 of 5.6x, representing a discount to the

international average of 6.5x, with a ~3% discount to its historical forward
EV/EBITDA average since 2011. Although we believe AMX stock has some room for a
rerating to diminish this difference (at our TP, AMX would trade at 6.0x EV/EBITDA15),
We believe AMX is not trading at such rich multiples as it used to, due to a tougher
regulatory environment in some of its main markets, and slower growth in Latin American
operations. We expect AMX to post an EBITDA CAGR15-17 of 2.2%, which is below the
Bloomberg consensus for international peers (5.4%). In terms of P/E, the company is
also trading at a discount, at 12.2x for 2015, compared to 15.8 for international
peers.
We also highlight that some international companies stocks (especially European)

have experienced a re-rating from 5.0 to the 6.0x level, driven by potential market
consolidation. On the other hand, AMX, which is used to trade at a higher multiple
(above 6.0x), has suffered a de-rating in recent years. This is attributable to slower
organic growth by the company compared to historical levels, due to a slowdown in the
regions economic growth and greater penetration of telecom services in the countries
where it operates even though penetration in these countries is still much lower than in
developed countries, especially for broadband (fixed and mobile) and pay TV services.
We also point out that the company has faced regulatory headwinds in several
countries, as it is the leading player and is subject to asymmetric rules, or because
regulatory agencies are imposing harsh measures on all operators. In Mexico, the new
telecommunication law brought a great deal of regulatory uncertainty, as the regulatory
agency imposed asymmetric rules on AMX, and prohibited domestic long-distance
charges for all carriers. In response, the company announced it would sell part of its
assets to no longer be considered a preponderant player. In Brazil and Chile, regulatory
authorities have implemented a sharp reduction in MTRs. Meanwhile, in Colombia,
besides having asymmetric rules, all carriers will be barred from selling contract postpaid
plans. Lastly, in Europe, the European Commission (EC) has proposed completely
abolishing active roaming charges in the European Union by YE15, while Balkan
countries have also announced plans to pursue the establishment of a Balkan roaming
zone with significantly-reduced prices for roaming.
In our view, although consolidation should be an upside opportunity for AMX, it

will likely be limited to a few countries where it operates (such as Brazil). First, it
already has a large market share in most of the countries where it operates, and some of
these markets already have a limited number of players, in our view being less likely to
consolidate further. For example, there are only three major mobile players in Mexico,
Colombia, Austria and Chile, and only two in Ecuador and Peru. The only country where
consolidation is more imminent is in the Brazilian mobile market, which accounts for
~24% of the companys total revenues, and ~19% of EBITDA.
9
COMPANY REPORT
Figure 8: Historical Forward and Trailing EV/EBITDA Multiple Figure 9: Historical Forward and Trailing P/E Multiple
7.0 20
6.5 18
16
6.0
14
5.5
12
5.0
10
4.5
Jan-11 Jul-11 Jan-12 Jul-12 Jan-13 Jul-13 Jan-14 Jul-14 8
Jan-11 Jul-11 Jan-12 Jul-12 Jan-13 Jul-13 Jan-14 Jul-14
Forward EV/EBITDA Trailing EV/EBITDA Forward P/E Trailing P/E
12m Avg. Forward EV/EBITDA 12m Avg. Trailing EV/EBITDA 12m Avg. Forward P/E 12m Avg. Trailing P/E
Implicit EV/EBITDA Implicit P/E
Source: Company, Bloomberg and Bradesco Corretora estimates Source: Company, Bloomberg and Bradesco Corretora estimates
Figure 10: International Multiples Analysis

Market EV/EBITDA EBITDA P/E Net Income
Cap. US$mn 2014 2015 2016 CAGR 15-17 2014 2015 2016 CAGR 15-17
Brazilian Peers
Telefnica Brasil 28,437 7.5 5.9 5.5 6.8% 15.8 16.3 15.2 9.2%
Oi 2,649 5.2 4.9 4.6 4.9% nmf 6.6 4.3 59.7%
Latam Peers
America Movil 74,988 5.8 5.6 5.5 2.2% 16.2 12.2 12.1 4.2%
Megacable 3,306 9.5 8.6 7.9 11.8% 20.0 18.0 16.6 14.1%
Entel 2,350 5.7 5.2 4.8 11.4% 14.4 13.0 12.8 2.0%
USA
Verizon 193,626 6.7 6.4 6.2 3.6% 13.6 12.4 11.8 6.6%
AT&T 172,310 6.0 5.8 5.8 2.5% 13.0 12.7 12.3 10.2%
T-Mobile 20,723 7.4 5.8 5.1 12.0% nmf 27.3 15.3 56.9%
Sprint Nextel 16,101 7.3 6.6 5.3 16.5% nmf nmf nmf N/A
Europe
Telefonica 70,138 6.4 6.2 6.0 1.0% 14.2 13.4 12.5 5.9%
Telecom Italia 20,303 5.7 5.7 5.8 -0.8% 12.1 11.8 11.2 5.4%
Deutsche Telekom 74,836 6.4 6.2 6.0 3.1% 21.8 19.9 17.8 13.9%
BT Group 51,102 6.5 6.4 6.3 1.9% 14.1 13.2 12.1 6.0%
France Telecom 45,701 5.8 5.9 5.9 -1.2% 15.5 14.5 14.0 6.5%
Vodafone 93,659 7.3 7.1 6.8 4.4% 8.4 nmf nmf 11.1%
Millicom 7,745 6.0 5.1 4.6 N/A 10.5 17.8 14.6 N/A
Telefonica Deutschland 15,796 8.6 6.6 5.8 16.3% nmf nmf nmf N/A
Swisscom 27,563 8.0 7.9 7.9 1.6% 15.8 15.7 15.6 1.1%
Koninklijke KPN 13,701 8.3 8.8 8.8 -0.2% nmf nmf nmf 34.3%
Telekom Austria 4,262 5.6 5.4 5.3 2.4% nmf 16.0 12.7 0.3
International Average 6.9 6.5 6.1 5.4% 14.5 15.8 13.8 14.2%
Median 6.5 6.2 5.9 2.8% 14.2 14.5 12.8 8.4%
Source: Bloomberg and Bradesco Corretora estimates
10
COMPANY REPORT
Company Description
AMX is one of the largest telecommunication companies in the world and is the
leading telecom operator in most Latin American countries where it operates. AMX
provides wireless services in 18 American countries and is the largest player in Mexico
and the third largest in Brazil (in terms of subscribers). In addition, AMX offers fixed-line
services in 14 countries - including Brazil, Mexico and Colombia - providing competitive
triple-play services (except in Mexico where it faces regulatory restrictions on providing
pay TV services). AMX also recently acquired a controlling stake (59.7%) in Telekom
Austria (TKA) after winning its tender offer and carrying out a 1.0bn capital increase.
TKA is the leading telecom operator in Central and Eastern Europe, with especially
strong operations in Austria. In addition, AMX has a stake of 21.4% in Koninklijke KPN
(KPN) that provides IT and telecoms services in the Netherlands.
Figure 11: AMXs Footprint
Source: Company
Figure 12: AMXs Subsidiaries

Country Brand Business Equity Stake Consolidation Method
Telcel Wireless 100.0% Global Consolidation Method
Telmex Wireline 97.8% Global Consolidation Method
Mexico
Seccin Amarilla Other 97.8% Global Consolidation Method
Telvista Other 89.0% Global Consolidation Method
Claro Wireless 100.0% Global Consolidation Method
Argentina
Brazil Embratel Wireline 95.8% Global Consolidation Method
Net Cable 92.5% Global Consolidation Method
Chile
Colombia
Costa Rica Claro wireless 100.0% Global Consolidation Method
Dominicana Claro Wireless/Wireline 100.0% Global Consolidation Method
Ecuador
El Salvador Claro Wireless/Wireline 95.8% Global Consolidation Method
Guatemala Claro Wireless/Wireline 99.3% Global Consolidation Method
Honduras Claro Wireless/Wireline 100.0% Global Consolidation Method
Nicaragua Claro Wireless/Wireline 99.6% Global Consolidation Method
Panama Claro Wireless 100.0% Global Consolidation Method
Paraguay Claro Wireless 100.0% Global Consolidation Method
Peru Claro Wireless/Wireline 100.0% Global Consolidation Method
Puerto Rico Claro Wireless/Wireline 100.0% Global Consolidation Method
Uruguay Claro Wireless/Wireline 100.0% Global Consolidation Method
USA Tracfone Wireless 98.2% Global Consolidation Method
Austria Telekom Austria Wireless/Wireline 59.7% Global Consolidation Method
Netherlands KPN Wireless/Wireline 21.4% Equity Method
Source: Company and Bradesco Corretora; Equity participation of Telmex Internacional of which AMX owns 97.8%
11
COMPANY REPORT
AMXs activities worldwide reported 287mn mobile subscribers in 3Q14, making it

the worlds fourth-largest player in terms of subscribers and the second largest
(excluding Chinese operators). AMX is especially strong in the mobile segment and
especially the prepaid segment that accounts for roughly 80% of its subscribers (the
exception is TKA that has 70% of its subscribers in postpaid segment). The companys
main markets for mobile are Mexico and Brazil, with each representing around one
quarter of its subscriber base. In Mexico, AMXs market share of the mobile segment is
~70%, while it is the third largest player in Brazil with a market share of 25.0%. Other
important markets include Colombia where it is the market leader; the US where it is a
MVNO operator, and TKAs operation that is the market leader in five European
countries. AMXs commercial strategy in the mobile segment is usually based on
providing better coverage, being the first to launch cutting-edge new technologies, and
being able to attract postpaid subscribers through handset subsides.
Figure 13: Breakdown of Mobile Subscriber by Country in 3Q14 Figure 14: Mix of Prepaid Subscribers by Country in 3Q14
TKA
6.9%
USA Mexico 100%
9.0% 24.5%
86% 87%
80% 80% 82% 79%
78% 75%
CAC 69%
6.7%
Peru
4.4% 30%
Ecuador
4.3%
Colombia Brazil
10.3% 24.3%
APU Chile
7.7% 2.0%
Source: Company and Bradesco Corretora Source: Company and Bradesco Corretora
The company reported 78mn fixed-line RGUs in 3Q14 spread across telephony,
broadband and pay TV services. Brazil is the most important market for AMX with a
fully convergent package of services and solid operations in all services, even though it is
not the local incumbent fixed-telephony operator. Brazil represents 46% of fixed-line
RGUs. Meanwhile, Mexico is AMXs second most important market, corresponding for
28% of RGUs. However, the company is still not allowed to provide pay TV services given
its dominant economic agent status. Regarding fixed-business services, its fixed-
telephony service has managed to secure the largest number of subscribers via its
incumbent position in Mexico and its activities in some Central American and Caribbean
countries. Nevertheless, pay TV and broadband services (in that order) have posted the
strongest organic growth due to having low penetration in Latin America. Finally, it is
worth noting that triple play offerings continue to drive fixed RGU net additions, while
single play plans have been shrinking.
Figure 15: Breakdown of Subscriber by Country in 3Q14 Figure 16: Mix of Fixed Business RGUs in 3Q14
TKA 5.5%
CAC 8.8%
Peru 1.6%
27.6%
Mexico 28.0%
Ecuador 0.4%
Colombia
6.8% 43.8%
APU 0.8%
Chile 1.6%
28.6%
Brazil 46.4% Landline Broadband Pay TV
12
COMPANY REPORT
AMX continues to post solid growth for a large-scale traditional telecom operator
given its strong position in Latin America that provides attractive growth prospects
and opportunities for investment to expand its footprint. The telecom giant has been
able to post revenue growth in the mid-single digits (at constant currency) driven by solid
growth for its mobile and fixed data activities as well as pay TV services. Meanwhile, fixed
voice has been declining given the migration of traffic from fixed line to mobile, declining
mobile voice related to data substitution, and regulatory headwinds. Mobile revenues
corresponded for 62% of total service revenues in 3Q14, while mobile data revenues
already represent ~44% of mobile service revenues (+6.0 p.p. YoY) driven by the greater
penetration of smartphones. Fixed business revenues, for their part, represented 38% in
3Q14, out of which voice revenues accounted for 41.7% (-150bps YoY), fixed data for
34.6% (+130bps) and pay TV for 23.7% (+20bps) for the fixed business revenue.
Figure 17: Revenues Breakdown by Service in 3Q14 Figure 18: YoY Revenues Growth in 3Q14 (Constant Currency)
9.1%
15.2% 14.7%
13.3%
34.7%
11.5%
4.7%
27.0%
16.0%
-3.0% -2.0%
Wireless Voice Fixed Voice Wireless Data
Wireless Fixed Voice Wireless Fixed Data Pay TV Total
Fixed Data Pay TV Voice Data
Mexico is AMXs most important market given the companys incumbent position
in the fixed-telephony business and its strong mobile operation. Nonetheless,
AMXs operations in Brazil should outpace the companys operations in its home country
due to stronger organic growth in the former country and regulatory headwinds in Mexico.
AMX intends to sell an important part of its operation in Mexico to cease being
considered as a preponderant economic agent leading to asymmetric measures by the
Mexican regulatory agency (the IFT). Meanwhile, its Brazilian operation has achieved
strong growth on the back of NETs fast expansion to new cities and the pay TV
segments fast growth. In addition, AMX in the US has achieved solid organic growth and
positive contributions from small acquisitions. Nevertheless, it is worth adding that
consolidated organic growth in 3Q14 of 4.7% (in constant currency) may be somewhat
misleading due to Argentinas inflationary environment.
Figure 19: Revenues Breakdown by Country in 3Q14 Figure 20: YoY Revenues Growth in 3Q14 (Constant Currency)
TKA 8.5% 42.3%
USA 9.9%
Mexico 31.1%
CAC 5.7% 15.5%

Peru 2.8% 7.4%
6.5% 4.7%
Ecuador 2.5% 1.8% 1.5% 1.2%
Colombia -0.8% -1.6%

8.7% -5.8%
APU 4.7%
Brazil 24.1%
Chile 1.9%
13
COMPANY REPORT
AMX features good profitability given its large scale in many countries, especially
in Mexico, even considering its aggressive commercial policy of subsidizing and selling
handsets. In Mexico and Colombia, where the company is the largest player, AMX should
post EBITDA margins of 44% and 41%, respectively, even though regulatory agencies in
these countries have applied asymmetric measures against the company. Moreover,
AMX has been integrating its assets in Brazil that should continue to push up its margins.
Meanwhile, TKA is pursuing its plan to reduce operating costs, for which it expects to cut
opex and capex by 100mn in 2014. Given AMXs very high EBITDA margin in Mexico,
this country represents more than 40% of the consolidated EBITDA. Nevertheless,
EBITDA should be more diversified after selling part of the Mexican operation, which
should reduce revenues and negatively impact margins due to having a smaller scale.
Figure 21: EBITDA Breakdown by Country in 3Q14 Figure 22: YoY EBITDA Margin by Country in 2014
TKA 10.0% 45.2%

43.6%
40.6%
USA 2.7% 37.1%
CAC 5.9% 32.2% 33.5% 33.6% 32.1%
Peru 3.0% 25.5%

Mexico 41.7%
Ecuador 3.5%
10.5%
Colombia 7.3%
10.4%
APU 4.6%
Chile 0.5%
Brazil 17.7%
AMX has been heavily investing in its network to build a competitive edge in all
regions where it operates, capturing growth opportunities in pay TV and
broadband with a focus on convergence. AMX launched a five-year plan to invest
US$10bn per annum until 2015. After almost four years of this plan, the company has
already connected 90% of its mobile towers with fiber optic cable in Mexico and Brazil
that should quicken the roll-out of 4G networks, while it has also expanded its 3G
coverage to smaller cities that provide faster speeds. Furthermore, AMX has expanded
the number of homes covered by NET from 10mn in 2010 to roughly 20mn in 2014, and
AMX launched a new satellite in 2013 and has plans to launch two more between 2015
and 2016. It also built a submarine cable to link its South American operations to
Caribbean and North American operations that should satisfy demand for the next 20
years. Moreover, AMX has built four new data centers to strengthen its operations for
corporate solutions. Besides helping to accelerate revenues growth, this investment
should help AMX to reduce costs that should appear more clearly in 2015s results.
Figure 23: Capex (US$bn) and Capex as % of Net Revenues
18.2% 17.9% 17.8%

16.9% 16.5%
13.4%
11.4 11.4
10.2 10.4
9.4
6.5
2010 2011 2012 2013 2014e 2015e
Capex % of Net Revenue
Source: Company and Bradesco Corretora estimates; Includes the acquisition of TKA and spectrum licenses in Brazil and Argentina
14
COMPANY REPORT
Mexico
AMX is the largest fixed-line and wireless operator in Mexico, providing almost
every type of telecoms service (except for pay TV). The company offers wireless
services through its subsidiary Telcel that had a market share of ~70% and 70.5mn
subscribers in 3Q14. Meanwhile, its subsidiary Telmex is a concession operator that was
privatized in 1990. The operation had 13.1mn fixed-line voice subscribers and 9.1mn
broadband subscribers in 3Q14, as well as a market share of around 65% respectively for
each service. Given its large market share in these services, AMX was considered
as a preponderant economic group and the regulatory agency imposed various
asymmetric measures on it.
Figure 24: RGU Breakdown in 2014 Figure 25: RGU CAGR 2011-14
9.9% 5.0%
14.0% 2.5%
1.6%
76.1%
-4.3%
Wireless Landline Broadband
Wireless Landline Broadband Total
Source: Company and Bradesco Corretora estimates Source: Company and Bradesco Corretora estimates
Figure 26: Revenues Breakdown in 2014 Figure 27: Revenues CAGR 2011-14 Constant Currency
38.5%
27.5%
37.7%
11.6%
2.0%
23.5%
11.3% -1.7%
-10.1%
Wireless Voice Wireless Data
Handsets Fixed-Line Wireless Voice Wireless Data Handsets Fixed-Line Total
Telcels strong prepaid operation accounts for 86% of its mobile subscribers. This
makes its results more volatile to economic fluctuations as recharges are sensitive to any
downturn. Mobile revenues represent 51% of AMXs total revenues in Mexico, with data
revenues corresponding for 46% of wireless service revenues. Data service revenues
have been the main source of mobile service revenues growing at a rate of 38%, while
voice revenues have been shrinking 10% a year in light of regulatory headwinds and data
substitution.
AMXs Mexican wireless subsidiary provides mobile services using GSM, 3G and
LTE technologies. The GSM subscriber base represented ~67% of Telcels subscriber
base, 3G technologies accounted for ~31% and 4G ~2% at YE13. GSM was present in
202k localities including every major Mexican city and on key roads, while 3G is situated
15
COMPANY REPORT
in 133k localities, and the latter was in only nine major cities and after beginning its rollout
at YE13.
Telcels sales and distribution is carried out mainly through retail chains, with
more than 40k points of sales and 346 company-owned stores. The company also
has a corporate sales group to address the needs of large enterprises and customers that
are heavy users. In 2013, the company obtained 22% of handset sales through company-
owned stores.
Telmexs subscribers for fixed-line operation reached 22.2mn subscribers in 3Q14,

making it the largest player in terms of RGUs. The company reported ~13.5mn fixed-
telephony subscribers in 2013 with a market share of ~66% (compared to 78% in 2010).
Nonetheless, it has been losing market share due to new regulations that have sparked
increased competition, and Telefnicas fixed-telephony services based on wireless
technology as well as smaller cable operators. In 2013, Telmex also reported 8.9mn
broadband subscribers and a market share of ~66% compared to 62% in 2010. However,
unlike in fixed telephony, Telmex managed to snatch market share from small companies
even though Televisa and Megacable have been slightly more aggressive.
Telmex is not allowed to offer broadcast and pay TV services. This makes the
companys bundles less competitive than its peers that provide triple-play plans. In our
opinion, if Telmex is able to unify its concession rights, the company could begin to offer
pay TV services. Nevertheless, this will take time as Telmexs concession migration is
dependent on complying with the IFTs asymmetric measures for two years.
Market Overview
The Mexican telecom sector has been undergoing various transformational

changes. The new Federal Telecommunication and Broadcasting Law has imposed
harsh measures on predominant economic companies in order to foster
competition. The new law is expected to lead to the arrival of new players in the fixed
and mobile businesses, as the government inter alia has obliged predominant companies
to open up their networks. Moreover, in order to avoid asymmetric measures, AMX
intends to dispose part of its operation to reduce its market share in the fixed and mobile
businesses to below 50%. Therefore, prices for telecom service should keep on declining
(in both nominal and real terms) as smaller players can take advantage of asymmetric
measures.
In the fixed segment, Telmexs main competitors are Alestra, Axtel, Maxcom,
Megacable, Cablevisin and Cablems. Meanwhile, Iusacell, Telefnica as well as
Nextel (in some regions) are the main competitors in the mobile segment.
Mobile subscribers in Mexico reached 105mn in 2013 and the number is growing in
the mid-single digits. The subscriber base is mostly made up of prepaid customers that
represent ~85% of the total, and the subscriber mix has remained practically stable in
recent years, even though AMX gradually improved its mix of subscribers. According to
the IFT, in 2012 mobile revenues corresponded to ~50% of telecommunications revenues
in Mexico, or ~P$210bn, while its growth was about 5% a year. Mobile penetration is at
~90% of the Mexican population.
The base of fixed telephony subscribers in Mexico has been mainly flat since 2008.
This was because the service had already reached 72% of households, while fixed
telephony has been substituted by mobile voice. The number of landline subscribers
stood at 20.6mn in 2013, with Telmex losing market share while Telefnica and Televisa
16
COMPANY REPORT
gained market share. Fixed telephony net revenues totaled ~P$103bn in 2012,
representing roughly 25% of total telecom revenues.
The number of broadband subscribers in Mexico has also remained flat. However,
the penetration of this service is at 47% of households with room to grow. The number of
fixed broadband subscribers stood at 13.6mn in 2013, with Telmex, Televisa and
Megacable grabbing market share from smaller players.
The Mexican pay TV segment, for its part, has continued to grow at a brisk pace
(CAGR 2010-13 of ~13%) as this service is present in only ~52% of the countrys
households. The number of pay TV subscribers reached 14.7mn in 2013, divided among
four main companies: Sky, Dish, Televisa and Megacable. In terms of technology, DTH
has been growing quickly and accounting for a large slice of the market, representing
53.0% of the total number of subscribers, while DTH technology represents the rest. If
AMX receives IFTs approval to provide pay TV service and starts to offer triple-play
plans, in our view, the segment should experience even steeper growth in the coming
years.
Figure 28: Wireless Subscribers (Thousands) Figure 29: Wireless Market Share in 2013
10.5% 3.1%
9.8% 7.6%
6.5%
3.5% 4.2%
3.0%
105,006 108,156 19.3%

94,583 100,727
91,383
83,219
70.0%
2009 2010 2011 2012 2013 2014e
Subscribers Growth YoY Telcel Telefnica Iusacel Nextel
Source: IFT and Bradesco Corretora estimates Source: Companies and Bradesco Corretora estimates
Figure 30: Wireline Subscribers (000s) Figure 31: Wireline Market Share in 2013
4.3%
2.1% 14.7%
0.0% -0.5%
-0.9%
2.8%
-4.8% 4.5%
20,588 20,590 20,487
19,919 19,731 4.4%
19,506
7.7%
65.8%
2009 2010 2011 2012 2013 2014e Telmex Telefnica Televisa

Subscribers Growth YoY Axtel Megacable Others
Source: IFT and Bradesco Corretora estimates Source: Companies and Bradesco Corretora estimates
17
COMPANY REPORT
Figure 32: Broadband Subscribers (000s) Figure 33: Broadband Market Share in 2013
22.9%
17.3% 11.1%
7.4% 3.7%
6.1%
0.1% 1.0%
7.0%
12,748 13,524 13,537 13,672

11,875
10,124
12.3%
65.8%
2009 2010 2011 2012 2013 2014e
Subscribers Growth YoY Telmex Televisa Megacable Axtel Others
Source: Companies and Bradesco Corretora estimates Source: Companies and Bradesco Corretora estimates
Figure 34: Pay TV Subscribers (000s) Figure 35: Pay TV Subscribers in 2013
25.1%
9.1%
0.3%
14.1% 14.2% 13.3% 12.8% 12.0%
14.6%
16,413 39.7%
14,655
12,993
11,470
10,044
8,027
17.0%
2009 2010 2011 2012 2013 2014e 19.2%
Subscribers Growth YoY Sky Dish Televisa Megacable Axtel Others
Recent Regulatory Changes
The Mexican government has implemented structural changes in the country and
the telecommunication sector has undergone some major transformational
changes. The government developed a new regulatory framework for
telecommunications and broadcasting services, and founded a new regulatory agency
called Instituto Federal de Telecommunicaciones (IFT) that replaced Cofetel. IFTs broad
powers cover all telecoms and broadcasting regulations, as well as any competition
legislation that applies to these sectors.
The Mexican government imposed asymmetric regulations on preponderant

economic agents. According to the Federal Telecommunication and Broadcasting Law,
any company that has, directly or indirectly, a nationwide market share of more than 50%
(measured in terms of either users, subscribers, audience, traffic on their network or the
capacity used) is deemed to be a dominant economic agent. As a result, AMX was
considered to be a preponderant economic agent in the telecommunication sector, and
asymmetric measures were applied. These measures have had, and should continue to
have, a substantial impact on AMXs fixed-line and wireless businesses. Televisa was
also considered to be a preponderant economic agent in the broadcasting segment.
18
COMPANY REPORT
Figure 36: AMXs Market Share by Service and Traffic in June 2013
Service Market Share
Fixed Lines Subscribers 67.6%
Local Traffic 67.5%
Long-Distance Traffic 64.8%
Long-Distance International Traffic 55.9%
Fixed Broadband Subscribers 66.9%
Wireless 70.1%
Local Traffic 70.1%
SMS 85.5%
Broadband 62.0%
Total Subscribers 61.8%
Source: IFT
The main asymmetric measures related to AMX are as follows:
Interconnection: AMX has been unable to charge other operators MTR fees
since August 13, 2014, while it needed to pay to its competitors P$0.2045 per
minute. Thereafter, if IFT determines that there is effective competition in the
telecom sector, the entire industry (fixed and mobile) would migrate to a bill and
keep model, and hence interconnection rate would fall to zero.
Same on-net and off-net tariff: The company cannot differentiate the tariff it
charges between on-net and off-net calls, undermining its club campaigns.
Infrastructure sharing: AMX must provide other operators with access to its
passive infrastructure, including towers, sites, ducts and rights of way. Access
rates are freely negotiated among the operators, but if an agreement is not
reached, IFT can intervene and set prices based on a long-term average
incremental cost methodology (LRAIC).
Local loop unbundling: The company has to offer operators access to separate
parts of its local network. If an agreement is not reached, IFT may intervene and
set prices based on a long-term average incremental cost methodology (LRAIC).
Leasing of dedicated links: AMX must lease dedicated links to other operators.
Access rates will be freely negotiated among the operators. However, if an
agreement is not reached, IFT may intervene and set prices based on a retail
minus methodology.
Access to MVNO services: AMX must provide mobile virtual network operators
access to the services that it offers customers. The operators should be able to
freely negotiate rates, but if an agreement is not reached, IFT may intervene and
set prices based on a retail minus methodology.
Roaming: The company must provide roaming services at a national level to

other mobile operators.
Retail services: Rates must be controlled for certain telecoms services. AMX is
also subject to various obligations regarding the sale of services and products,
including an obligation to provide individual services that make up a bundle, while
there are limitations on the exclusive sale of handsets and tablets, and a
requirement to eliminate SIM-locks on handsets.
19
COMPANY REPORT
Elimination of domestic roaming charges: The company will be prohibited

from charging its customers roaming charges within Mexico.
Nevertheless, asymmetric measures can be terminated if the IFT decides that AMX
is no longer a preponderant agent or competitive conditions improve. According to
the Federal Telecommunication and Broadcasting Law, a company classified as a
preponderant economic agent can at anytime submit a plan to IFT to show how it will
reduce its national market share to below 50%. The plan can include its objectives to
carry out a structural separation through the sale of assets, rights, social parts or any
combination of these. However, in IFTs opinion, the implementation of this plan must
create the necessary conditions to allow effective competition.
The new law also enables current players to migrate to a universal concession
model, where they can offer all types of telecommunication and broadcasting services
under a unified concession system. However, preponderant companies need to obtain
the IFTs consent to migrate to this model and must comply with additional regulations,
particularly related to infrastructure sharing.
AMXs board of directors approved a plan on July 8 to implement various

measures to reduce its national market share to under 50%. The plan includes
asset sales in order to remove the preponderant economic agent classification.
According to AMX, the companys aim is that certain assets need to be sold to a strong
carrier willing to invest and compete in the Mexican market in order to structurally change
the competitive landscape in the Mexican telecoms sector. However, any asset sale is
contingent upon an assurance from the regulatory agency that the asset sale would be
sufficient to ensure that AMX is no longer be a preponderant economic agent. The assets
would also need to be sold at market conditions at close to fair value. If this plan is
successful, it would allow AMX to provide convergent bundles including pay TV services.
AMXs steps to carry out divestitures are as follows:
I The company submits its plan to IFT.
II IFT will analyze the proposed plan within 120 days from the date of its submission
and, if necessary, the regulatory institute may extend this period by 90 days. To obtain
the necessary approval, IFT must conclude that the plan will effectively reduce AMXs
nationwide share to below 50%.
III Once the plan is executed and the conditions of effective competition are met, the
obligations imposed on AMX can be eliminated.
IV - The previous requirements do not prevent IFT from carrying out new procedures to
determine whether there is a preponderant economic agent in any of markets where AMX
operates.
V IFT may authorize AMX to provide additional services or move to a unified

concession system, provided that the authorization does not generate adverse effects on
competition. AMX must show it is in compliance with any applicable laws and its
concession in a period of 18 months after the implementation of the approved plan.
Under the regulations, AMX can also begin providing pay TV services after ceasing
to be considered as a preponderant economic agent. This would enable AMX to sell
triple and quadruple play bundles that would help the company to reduce its fixed-line
20
COMPANY REPORT
churn and strengthen its plans. This would also give AMX exposure to a segment that is
still growing at a double-digit rate. In addition, as the company already has a
comprehensive fixed and satellite network, low investment and only incremental costs
should be required to start-up pay TV services, while further increasing its scale to
acquire content.
However, to provide pay TV services, AMX will need to comply with specific
regulations and this is unlikely to happen in the short term. Therefore, although AMX
kept its commercial agreement with Dish Mexico, the company has waived its rights to
purchase a 51% stake in Dish Mexico given aforementioned timeframe.
Besides the asymmetric measures, the regulatory authority prohibited domestic

long-distance charges for mobile and fixed carriers. Nevertheless, it is worth noting
that several mobile and fixed plans already included packages of domestic long-distance
minutes, and therefore the impact should not be so material. Lastly, IFT barred carriers
from acquiring exclusive transmission rights for relevant content (large audiences on a
nationwide or regional scale, such as the FIFA World Cup).
Consolidation Events
AT&T recently entered into the Mexican telecom sector bidding to acquire Iusacell
for US$2.5bn from Grupo Salinas (regulatory approvals are still required). Iusacell,
which is the third largest mobile operator with around 8.6mn subscribers and market
share of 8.4%, had been posting poor operating results before the acquisition due to its
small scale and tough competition from Telcel. AT&T said that it plans to strengthen
Iusacells balance sheet to reinforce its ability to make investments in its network to
improve the quality and allow higher mobile broadband speed. In our view, the entrance
of AT&T into the Mexican market is a good sign. In our view, it indicates that the telecom
sectors reforms have yielded positive outcomes and have attracted top-quality
multinational companies. As a result, this seems to suggest that competition should
intensify going forward.
In addition, AT&T has also openly stated that it is interested in acquiring Nextel in
Mexico, which could add 2.8mn mobile subscribers, increasing its market share to
11.2%. However, AT&Ts share of revenues would be much higher, as both Iusacell and
Nextel are focused on high-end customers that provide greater ARPUs. Nextels ARPU is
the highest in the segment at P$445, followed by Iusacell at P$167, and Telcel with
P$166.
AT&T is also a potential buyer of AMXs assets for sale in Mexico and this could
make the US player a strong competitor. Nonetheless, AT&Ts CEO said that it
does not need to acquire these assets in Mexico to have a strong operation in the
country. AT&T envisages good growth prospects for the telecom sector in Mexico and
the company knows AMXs operation as it was previously a major shareholder in AMX.
Moreover, this scenario would neatly fit AMXs plan to sell part of its operation to a
company with expertise in the sector in order to boost competition and end its status as a
preponderant player. Given that AMX holds ~70% of the mobile segment, it would have to
sell a stake of at least 20%. Therefore, if AT&T is the buyer, the company could
accumulate a market share of about 35% in the mobile segment and compete head-to-
head with AMX.
21
COMPANY REPORT
Spinning-off the Tower Business
AMX also aims to unlock value from its shareholders by spinning off its passive
infrastructure, including ~13k cellular towers in Mexico. This strategy has already
been approved by AMXs board of directors, and the company expects to conclude this
process in 1H15. According to AMX, the spin-off does not need regulatory approval to be
concluded. However, it is worth noting that AMX does not intend to sell its towers, which
suggests that its current shareholders should receive shares from a new company
created to manage AMXs passive infrastructure. Moreover, we believe AMX may adopt a
similar strategy in the other Latin American countries, even though it has not obtained a
decision yet on this matter.
The rationale behind this strategy is that towers value more outside of AMX than
inside. Telecom companies are on average trade at an EV/EBITDA multiple of 6.2x for
2015, while tower companies trade at a much higher multiple of 18x. If we consider that
AMX may value its 13k cellular towers at a price similar to the latest Latin American tower
sale of US$250k, these towers would be worth US$3,250mn outside the company rather
than only US$1,200mn inside it. Therefore, if AMX continues to trade at the same
multiple after spinning off its towers, it would be able to generate up to US$2,300mn for
its shareholders through plain vanilla arbitrage. In our model, the spin-off of towers adds
US$1.7bn (1.8% of our TP). Therefore, the unlocked value would be only marginally
positive for AMX.
Figure 37: Tower Sales Transactions Details

Seller # of Tow ers Sold Price (US$m n) US$/tow er (000's) Buyer
2010
Telefnica Brasil 1,085 132,709 122.3 TorreSur
2011
Telefnica Brasil 1,358 284,901 209.8 BR Tow ers
Telefnica Mexico 2,500 500,000 200.0 American Tow er
Millicom Colom bia 2,126 182,000 85.6 American Tow er
2012
Telefnica Brasil 800 141,504 176.9 American Tow er
Telefnica Brasil 700 123,817 176.9 American Tow er
Telefnica Brasil 1,912 256,789 134.3 BR Tow ers
Telefnica Brasil 800 185,215 231.5 SBA Communications
Oi 1,200 264,842 220.7 TorreSur
2013
Oi 4,000 501,349.2 125.3 BR Tow ers + 5 Torres
Oi 2,113 315,861.5 149.5 SBA Communications
Telefnica Brasil 93 18,780.4 201.9
Nextel Brasil 2,790 413,000 148.0 American Tow er
Nextel Mexico 1,666 398,000 238.9 American Tow er
Nextel 1,900 374,310.1 197.0 American Tow er
2014
BR Tow ers 4,640 927,659.6 199.9 American Tow er
TIM 6,481 1,276,595.7 197.0 American Tow er
Total 39,812 7,496,634 188.3 -
Source: Companies and Bradesco Corretora
22
COMPANY REPORT
Figure 38: Valuation Comparison Between Telecom and Tower Companies

Market EV/EBITDA EBITDA P/E Net Income
Cap. US$mn 2014 2015 2016 CAGR 14-17 2014 2015 2016 CAGR 14-17
Tower Companies
SBA Communications 14,660 22.0 19.6 18.0 9.5% nmf nmf nmf nmf
American Tower 38,826 19.8 17.9 16.3 9.0% 47.2 35.5 28.9 26.2%
Crown Castle 25,455 17.8 17.6 17.0 2.9% 74.8 55.4 46.5 23.4%
Average 19.9 18.4 17.1 7.1% 61.0 45.4 37.7 24.8%
Telecom Companies
Telefnica Brasil 28,437 7.5 5.9 5.5 6.8% 15.8 16.3 15.2 9.2%
Oi 2,649 5.2 4.9 4.6 4.9% nmf 6.6 4.3 59.7%
America Movil 74,988 5.8 5.6 5.5 2.2% 16.2 12.2 12.1 4.2%
Megacable 3,306 9.5 8.6 7.9 11.8% 20.0 18.0 16.6 14.1%
Entel 2,350 5.7 5.2 4.8 11.4% 14.4 13.0 12.8 2.0%
Verizon 193,626 6.7 6.4 6.2 3.6% 13.6 12.4 11.8 6.6%
AT&T 172,310 6.0 5.8 5.8 2.5% 13.0 12.7 12.3 10.2%
T-Mobile 20,723 7.4 5.8 5.1 12.0% nmf 27.3 15.3 56.9%
Sprint Nextel 16,101 7.3 6.6 5.3 16.5% nmf nmf nmf N/A
Telefonica 70,138 6.4 6.2 6.0 1.0% 14.2 13.4 12.5 5.9%
Telecom Italia 20,303 5.7 5.7 5.8 -0.8% 12.1 11.8 11.2 5.4%
Deutsche Telekom 74,836 6.4 6.2 6.0 3.1% 21.8 19.9 17.8 13.9%
BT Group 51,102 6.5 6.4 6.3 1.9% 14.1 13.2 12.1 6.0%
France Telecom 45,701 5.8 5.9 5.9 -1.2% 15.5 14.5 14.0 6.5%
Vodafone 93,659 7.3 7.1 6.8 4.4% 8.4 nmf nmf 11.1%
Millicom 7,745 6.0 5.1 4.6 N/A 10.5 17.8 14.6 N/A
Telefonica Deutschland 15,796 8.6 6.6 5.8 16.3% nmf nmf nmf N/A
Swisscom 27,563 8.0 7.9 7.9 1.6% 15.8 15.7 15.6 1.1%
Koninklijke KPN 13,701 8.3 8.8 8.8 -0.2% nmf nmf nmf 34.3%
Telekom Austria 4,262 5.6 5.4 5.3 2.4% nmf 16.0 12.7 25.2%
Average 6.7 6.3 6.0 5.4% 14.8 15.1 13.3 15.7%
Median 6.4 5.9 5.8 3.3% 14.4 14.5 12.8 9.5%
Source: Bloomberg and Bradesco Corretora estimates
The value of towers will depend on the new companys ability to expand the
tenants per tower. In our view, this could be somewhat challenging as the Mexican
mobile market is concentrated in just a few players. Telcel currently has a market share of
70% in the mobile market, and we believe it should remain with about 45% of the market,
even after selling part of its operations.
Asset Sales
Although we are not assuming that AMX will sell its assets and reduce its market
share to below 50% in our base case scenario, due to a lack of visibility, we ran
some simulations to measure the impact of the asset disposal on the companys
valuation. In our exercise, we assume the company would sell part of its operations to
reach a market share in terms of subscribers of 45% for mobile, landline and fixed
broadband services by YE15. This should represent a reduction of 21.3mn mobile
subscribers (30% of our estimate for YE15), 3.1mn landline subscribers (down 25%) and
3.3mn fixed broadband subscribers (down 35%). In our estimates for 2016, the pro-forma
impact on net revenues would total P$78.7bn, and P$33.1bn for EBITDA (assuming an
EBITDA margin of 42.0%, considering mobile tower spin-off).
We are assuming that the asset sale will not be value destructive in terms of
multipes, regardless of whether the company sells its assets on a regional basis or
nationwide, as a valuation of at least market value is one of the conditions to sell the
assets. Thus, we are assuming AMX will be able to sell its assets at an EV/EBITDA
multiple of 6.0x for 2015, similar to the fair multiple we envisage for the company. This
would lead to a transaction value of roughly P$200bn (US$14.8bn).
23
COMPANY REPORT
However, we expect the EBITDA margin of the remaining assets in Mexico to shrink
by 300bps, chiefly due to a smaller scale and tougher competition. Although the
company should be able to reduce part of its fixed expenses, there should be less dilution
of corporate and marketing expenses. In addition, the company will have to re-enter into
the regions where it sold operations, developing new infrastructure and reinforcing its
brand. Finally, and foremost, AMX should face tougher competitive conditions that could
lead to greater churn, subsidies and selling expenses.
Conversely, the company would be able to start offering pay TV services after no
longer being a preponderant economic agent. Nevertheless, the beginning of this
service is unlikely to happen in the short term, considering that unification of the
concession system and the authorization to provide pay TV services should occur only 18
months after implementation of the asset sales plan. As a result, this service would begin
in mid-2017. As the company is already the largest pay TV provider in Latin America and
has a robust satellite network, we do not envisage that it would need a significant
increase in investment to set up the pay TV services in Mexico.
In our exercise, we assumed that AMX would capture roughly 50% of total pay TV
market net adds in the initial years of operations, driven by the offering of triple and
quadruple play offerings to its current customers that already have fixed-telephony and
broadband. This would represent the net additions of roughly 800k subscribers per year,
assuming the pay TV market will continue to add 1.6mn per year (implying market growth
in the mid-single digits after 2017). Based on these assumptions, we expect AMX to have
4.0mn pay TV subscribers in the long term (market share close to 15%), corresponding to
60% of our estimate for the number of fixed broadband subscribers. In terms of
valuation, the beginning of the pay TV services would contribute ~P$0.40 to our
target price.
Figure 39: Sensitivity Analysis on the Impact of Asset Sales on AMXs Valuation
EV/EBITDA Multiple for 2015
$ 18.0 5.00 5.25 5.50 5.75 6.00 6.25 6.50 6.75 7.00
0.0% 18.2 18.3 18.4 18.5 18.7 18.8 18.9 19.0 19.1
0.5% 18.0 18.2 18.3 18.4 18.5 18.6 18.7 18.9 19.0
Im pact 1.0% 17.9 18.0 18.1 18.3 18.4 18.5 18.6 18.7 18.8
on 1.5% 17.8 17.9 18.0 18.1 18.2 18.3 18.5 18.6 18.7
Margin 2.0% 17.6 17.7 17.8 18.0 18.1 18.2 18.3 18.4 18.6
2.5% 17.5 17.6 17.7 17.8 18.0 18.1 18.2 18.3 18.4
3.0% 17.3 17.5 17.6 17.7 17.8 17.9 18.1 18.2 18.3
3.5% 17.2 17.3 17.4 17.6 17.7 17.8 17.9 18.0 18.2
4.0% 17.1 17.2 17.3 17.4 17.5 17.7 17.8 17.9 18.0
4.5% 16.9 17.0 17.2 17.3 17.4 17.5 17.6 17.7 17.9
5.0% 16.8 16.9 17.0 17.1 17.3 17.4 17.5 17.6 17.7
Source: Bradesco Corretora estimates
Estimates
In our model, we are assuming that AMX will continue with asymmetric rules,
although the company has already announced a strategy to sell part of its
operations. We expect a decrease in mobile service revenues in 2015 in light of the
discontinuation of interconnection charges since August 13, 2013, and domestic long
distance starting in January. However, we do expect mobile data revenues to keep up
strong growth, in light of increasing penetration of smartphones, even though the
company has become a more conservative in its subsidy policy. For the fixed business,
we expect fixed telephony services to continue to diminish, driven by migration from fixed
to mobile, coupled with competition. However, we project broadband service revenues in
24
COMPANY REPORT
the low single digits, thanks to gradually increasing penetration of this service in the
country. Regarding margins, we expect the tougher competition stemming from the
asymmetric rules to have a ~100bps impact on profitability, while the spin-off of towers
should reduce margins by an additional ~75bps. As a result, we expect EBITDA margin to
fall to 42.3% in 2015, from 43.9% in 2013.
Figure 40: Main Estimates

MXN Million 2010 2011 2012 2013 2014 2015 2016 2017 2018 CAGR15-18
Net Revenue 250,234 256,082 271,047 275,596 271,898 261,826 264,678 268,665 273,362 1.4%
Wireless Revenues 148,059 152,697 172,230 179,351 174,770 164,954 167,850 171,258 174,657 1.9%
Service Revenues 126,204 130,157 143,375 144,123 142,165 138,925 141,441 144,157 146,850 1.9%
Equipment Revenues 21,855 22,540 28,497 34,558 31,359 26,029 26,408 27,102 27,807 2.2%
Fixed Line and Other Revenues 113,508 110,725 104,915 104,462 105,199 104,539 104,570 105,265 106,701 0.7%
EBITDA 132,640 128,804 122,932 120,970 118,528 110,442 111,906 113,587 115,570 1.5%
EBITDA Margin - % 53.0% 50.3% 45.4% 43.9% 43.6% 42.2% 42.3% 42.3% 42.3%
Mobile Subscribers (000's) 64,138 65,678 70,366 73,505 70,650 71,359 72,076 72,799 73,530 1.0%
Postpaid 6,359 7,460 8,610 9,393 9,945 10,548 11,156 11,771 12,392 5.5%
Prepaid 57,778 58,218 61,756 64,112 60,705 60,812 60,919 61,028 61,137 0.2%
ARPU (P$/m onth) 176.6 163.4 175.7 167.1 165.0 163.0 164.3 165.8 167.3 0.9%
% of Data 14.9% 18.9% 28.7% 40.5% 46.1% 51.8% 55.5% 58.6% 61.0%
RGUs (000's) 22,951 22,766 22,721 22,452 22,185 21,860 21,531 21,280 21,101 -1.2%
Landline 15,591 14,814 14,224 13,543 12,980 12,440 11,985 11,606 11,298 -3.2%
Broadband 7,359 7,952 8,497 8,908 9,205 9,420 9,546 9,674 9,803 1.3%
25
COMPANY REPORT
Brazil
AMX is an integrated and full-service provider of telecommunication services in

Brazil, being the largest player in terms of number of customers, and the second largest
in terms of net revenues. It is the third-largest wireless provider under the Claro brand,
and the largest broadband and pay TV operator through the brands Embratel and Net
Servios (NET). Moreover, AMX provides satellite solutions via its Star One subsidiary.
The company offer quadruple-play services with 18.8mn homes passed as of 4Q13. The
Brazilian operation accounts for ~25% of AMXs net revenues and ~20% of its
EBITDA.
16.0%
20.4%
17.6%
7.1%
11.3% 9.7%
8.3%
65.6%
5.1%
Wireless Landline
Broadband Pay TV Wireless Landline Broadband Pay TV Total
25.5%
22.8%
20.3% 20.2%
16.1%
10.3%
63.4%
3.5%

-3.4%
Competition in the Brazilian mobile market is quite tough, with the presence of four
large nationwide players. Claro competes mainly with Telefnica Brasil, TIM and Oi,
which have market share of 28.7%, 26.9% and 18.5%, respectively. In the case of fixed
telephony and broadband services, competition is more regional, and Claro competes
with Telefnica Brasil/GVT in the state of So Paulo, probably the most competitive
market, and Oi and GVT in the other Brazilian states. Meanwhile, competition in the pay
TV business is nationwide, with the main competitor being Sky/Direct TV, which has a
market share of 29.0%.
Claro had 69.6mn wireless subscribers, being the third-largest player, with market
share of 25.0% in 3Q14. The company has a strong operation in the prepaid segment, in
which it has a market share of 25.5% and 78.1% of the companys mobile subscribers,
thanks to its main plan, which charges for unlimited calls in most regions. In the postpaid
segment, the company is the second-largest player, with a market share of 23.3%,
26
COMPANY REPORT
positioning itself as the company with the fastest mobile broadband speed and 4G
connections at the same price as 3G plans. Mobile revenues account for 33% of the
companys total revenues in Brazil, but they are losing ground to fixed-line revenues due
to modest growth as the market decelerates, as well as the MTR cut. Data revenues
account for 31% of wireless service revenues, with a CAGR 2011-14 of 20.3%, while
voice revenues is shrinking by 3.4% per year.
The wireless operator provides wireless services using GSM, 3G and LTE
technologies, being the first company to offers the latter two in Brazil. As of YE13,
the company covered 3,646 cities in Brazil with GSM (91.6% of the population), 1,372
cities with 3G (72.6% of the population), and 60 cities with 4G (30% of the population). As
of 3Q14, ~71% of the companys subscriber base was already using 3G, 4G and data
devices, which suggests that data revenues still have considerable room to grow.
Claros sales and distribution are mainly through a retail chain with over 9.7k points of
sales, of which over 4.8k are exclusive and 332 are company-owned stores. The
company also has corporate sales group to address the needs of large enterprises and
heavy-user customers.
Embratel/NET had 35.6mn fixed-line subscribers, being the largest player in terms
of RGUs in 3Q14. Embratel offers domestic and international long-distance services, as
well as local fixed telephony services in all Brazilian states under the Claro brand, and in
connection with NET using Voice over Internet Protocol technology (NET Fone). The
company had 11.8mn fixed-telephony subscribers in 3Q14, with a market share of 25%,
and has been increasing its market share as NET adds new cities to its coverage. NET
added 50 cities to its coverage area over the course of 2013, reaching over 160 cities
(and aiming at 200 cities by YE14).
The company is also a leading provider of data communication services, renting

high-speed data lines to enterprises (most of Brazils top 500 corporations) and other
telecommunication companies, satellite data transmission, and broadband connection to
residential and commercial customers. Embratel/NET had 7.3mn broadband subscribers
in 3Q14, being the largest provider in terms of subscribers, with a market share of 31%.
In addition, Embratel/NET is a leading provider of pay TV services to residential
customers via cable and DTH technologies. The company is also the leader provider of
pay TV services, with 16.4mn subscribers in 3Q14 and a market share of 53%. NET
offers bundles of services, including quadruple-play services, with 18.8mn homes passed
as of 4Q13.
The company owns the largest long-distance network in Latin America and the
largest data-transmission network in Brazil, as well as the largest number of mobile
towers. AMX has 63.4k kilometers of cable, backbone distributed through 2,921 points of
presence, 15.5k kilometers of backhaul fiber network, nine submarine cable systems
reaching all continents, and 11k company-owned mobile towers. In addition, it has the
most extensive satellite system in Latin America, with seven satellites covering the entire
territory of South America and Mexico.
AMX is concluding the integration of its Brazilian assets (Claro, NET and Embratel),
which should be concluded by YE14 and yield substantial efficiency gains and
better services. The integration process has been developed for five years, with the
system integration already concluded (backhaul and backbone), and the IT system in a
very advanced stage (customer care, billing, customer care, etc.). Nevertheless, the
company will keep its three brands.
27
COMPANY REPORT
AMX is the telecom company that invests the most in Brazil, which explains its fast
growth. The company should invest R$36.5bn to expand its network and coverage
between 2011 and 2014, accounting for ~30% of the sectors total investment, compared
to the sectors share of wallet of roughly 23%. We estimate AMX posting a top-line
CAGR11-14 of ~7%, while the sectors revenues should increase by 4%, and its
integrated competitors should grow no more than 2%.
Figure 45: Share of Capex Between 2011 and 2013 Figure 46: Share of Wallet Between 2011 and 2013
3.8% 1.2% 4.3% 1.1%

5.9% 5.3%
3.4% 23.2%
7.3% 29.9%
14.7%
11.6%
26.0%
20.1% 20.3% 22.2%
Claro Telefnica Oi TIM GVT Direct TV Nextel CTBC Claro Telefnica Oi TIM GVT Direct TV Nextel CTBC
Market Overview
The Brazilian telecom sector has been experiencing modest growth, on lukewarm
economic growth, regulatory changes, and already-high penetration of some
telecom services. However, mobile and fixed data have driven the sectors growth,
offsetting the commoditization and decline of mobile and fixed voice revenues.
Meanwhile, the pay TV segment keeps growing at a reasonable rate given this services
still-low penetration. Mobile revenues growth has been in the low single digits, fixed
broadband, in the high single digits, pay TV, around 16%, and fixed telephony has been
deteriorating. Moreover, incumbent fixed-line carriers have lost ground to alternative
players, which is the case for NET, which continues growing fast.
Figure 47: Gross Revenues (R$bn) and YoY Growth by Segment

+2.2%
149.1 152.4
-17.3% 4.3
5.2
18.1 +16.6% 21.1
20.4 +7.4% 21.9
-3.2%
34.3 33.2
+1.1%
71.1 71.9
9M13 9M14
Mobile Landline Broadband Pay TV SME (Trunking)
Source: Telebrasil and Bradesco Corretora
Mobile revenues growth has been driven by data revenues growth (~20% YoY),
while voice revenues are declining in light of the sharp reduction in MTR, which will fall to
R$0.02 in 2019 (from R$0.25 in 2014). The subscriber base, for its part, is growing slowly
28
COMPANY REPORT
(+3.5% YoY), as it has already reached a high penetration of 137% of the population, with
278mn subscribers. Nevertheless, the customer mix has improved, as companies have
been more rational in managing their prepaid subscriber bases, adopting stricter clean-up
policies, while the postpaid subscriber segment has remained quite strong.
Fixed telephony revenues, for their part, have fallen on the ongoing migration from
fixed to mobile telephony, and poor performance by incumbent carriers. The
number of landline subscribers grew 1.4% YoY to 45.2mn in 3Q14, largely due to solid
growth by alternative players, especially NET and GVT.
Fixed broadband revenues have also been sustained by the alternative players
(NET and GVT), which have increased the number of cities covered. The number of
fixed broadband subscribers grew 8.8% YoY to 23.7mn in 3Q14, with NET and GVT
representing 47% and 23% of net additions in the LTM, respectively. These two
companies have a newer network, enabling them to provide faster broadband speeds
and more-competitive triple-play plans. Fixed broadband services are still
underpenetrated (~35%) compared to developed countries.
The pay TV segment continues to be the service that promises the best growth on
still-low penetration (~30%). The number of pay TV subscribers stood at 19.4mn in
3Q14, up 11.7% YoY, with most companies experiencing less intense growth across the
countrys varying regions. In terms of technology, cable TVs growth rate remained at
around 11.8% YoY, while direct-to-home (DTH) grew 10.9%.
Figure 48: Wireless Subscribers (million) Figure 49: Wireless Market Share
8.1%
3.6% 3.6% 3.6% 3.2% 3.0% 0.3% 0.6% 0.9% 1.2% 1.3% 1.5%
18.8% 18.5% 18.6% 18.8% 18.9% 19.0%
24.9% 25.3% 24.9% 24.9% 24.8% 24.8%
291 300 309 26.9% 27.1% 26.9% 26.7% 26.6% 26.5%

262 271 281
29.1% 28.5% 28.7% 28.5% 28.3% 28.2%
2012 2013 2014e 2015e 2016e 2017e 2012 2013 2014e 2015e 2016e 2017e
Subscribers Growth YoY VIVO TIM Claro Oi Others

Source: Anatel and Bradesco Corretora estimates Source: Anatel and Bradesco Corretora estimates
Figure 50: Wireline Subscribers (000s) Figure 51: Wireline Market Share
3.2%
2.4% 5% 5% 5%
2.0% 4% 4% 5%
1.6%
1.3% 8% 9% 10% 10% 11% 11%
0.8%
22% 24% 25% 26% 26% 26%
24% 24% 24% 24% 24% 24%

44,305 45,014 46,104 47,031 47,647 48,022
42% 39% 37% 35% 34% 34%
2012 2013 2014e 2015e 2016e 2017e 2012 2013 2014e 2015e 2016e 2017e
Number of Subscribers - LIS Growth YoY Oi Telefnica Embratel GVT Others
29
COMPANY REPORT
Figure 52: Broadband Subscribers (000s) Figure 53: Broadband Market Share
16.1%
12.1%
10.6% 9% 11% 13% 13%
9.1% 13% 13%
7.8% 6.9%
11% 12% 13% 14% 14% 15%
20% 18% 17% 17% 16% 16%
30% 30% 30% 30% 30% 30%

27,669 29,568
23,513 25,658
18,976 21,269
30% 28% 26% 26% 25% 25%
2012 2013 2014e 2015e 2016e 2017e 2012 2013 2014e 2015e 2016e 2017e
Number of Subscribers Growth YoY Oi NET Telefnica GVT Others
Figure 54: Pay TV Subscribers (000s) Figure 55: Pay TV Subscribers

27.0% 100%
90%
11.3% 11.7% 10.7% 9.9% 9.2% 80%
70% 31% 30% 30% 29% 29% 29%
60%
50%
40%
24,501 26,764 30%

22,289 52% 54% 52% 51% 50% 50%
18,020 20,129 20%
16,189
10%
0%
2012 2013 2014e 2015e 2016e 2017e 2012 2013 2014e 2015e 2016e 2017e
Number of Subscribers Change YoY - % Claro SKY Oi GVT Telefonica Others
Recent Regulatory Changes and Consolidation Events
The Brazilian government has recently auctioned the 700 MHz spectrum licenses
(4G), where AMX acquired one nationwide license at a total cost of ~R$3.0bn, including
spectrum clean-up expenses of R$1.2bn. The spectrum will be partially available in 2016
and fully available in 2019, and the license will have a 15-year lifetime starts upon the
signing date. The spectrum should enable the company to enhance its transmission
capacity and reap significant investment savings by using a better spectrum license to
meet Anatels investment obligations. Among the main players, only Oi did not acquire a
license.
The Mobile Termination Rate (MTRs) is set to reach R$0.02 by 2019, from R$0.25 in
2014. The sharp decline should drive down voice revenues in the coming years and force
the companies to adapt their promotions. Firstly, the companies should focus on
accelerating the adoption of data services, and secondly, change their marketing
campaigns from on-net traffic to flat fee plans (for on-net and off-net).
Telefnica Brasil announced the acquisition of GVT, strengthening its fixed-line

business outside its concession area (So Paulo state). In our view, this should
intensify competition outside the state of So Paulo, while somewhat diminishing
competition in this state. Telefnica Brasil will pay R$22.2bn for GVT, implying an
EV/EBITDA multiple of ~10x before synergies, and only 3.7x after synergies.
Moreover, a consolidation move in the Brazilian mobile market seems imminent.

Should mobile consolidation happen, the combined company may have to sell some of its
30
COMPANY REPORT
assets and operations in order to comply with likely requirements from the Brazilian anti-
trust authority and regulatory agency and Claro would be a potential buyer. Moreover,
Claro would benefit from a more rational competitive environment, which could increase
overall profitability. However, besides the regulatory barriers for this to happen, including
market concentration and spectrum license caps, Ois high debt is a significant
impediment.
Estimates
We expect net revenues to continue posting solid growth, despite the sectors
lukewarm performance, mainly on fast expansion of the fixed-line business, especially
broadband and pay TV, which still have low penetration. The company has been
increasing the number of cities covered by NET, and we expect this expansion to
continue in the coming years, considering that NET should be present in only 200 cities at
YE14. Meanwhile, for the wireless business, we project modest growth in light of the
sharp decline in the MTR, which undermine voice revenues offsetting wireless data
revenues double-digit growth. In addition, we anticipate the postpaid subscriber base
keeping up strong growth, to the detriment of the prepaid subscriber base, as Claro
should continue to encourage the migration of customers from prepaid plans to postpaid
plans. In addition, we expect data revenues to correspond to ~50% of wireless service
revenues in 2018, from 31% in 2014, while handset revenues should keep growing at a
faster pace, driven by increasing usage of smartphones. As for EBITDA margin, we
expect a gradual recovery, as the company evolves in the integration of its three
subsidiaries (Claro, NET and Embratel), and wireless data revenues account for a greater
share of mobile revenues. However, all of these growth initiatives should continue to
demand a great amount of investments. Thus, we expect capex to remain between
R$8.0bn and R$10.0bn (AMX invested R$10bn in 2013).

BRL Million 2010 2011 2012 2013 2014 2015 2016 2017 2018 CAGR15-18
Net Revenue 21,313 22,803 30,717 33,196 35,710 38,528 41,172 43,946 47,144 7.0%
Equipment Revenues 715 754 881 1,279 1,310 1,571 1,715 1,821 1,912 6.8%
EBITDA 6,278 5,991 7,322 7,874 9,102 10,205 11,317 12,518 13,901 10.9%
EBITDA Margin - % 29.5% 26.3% 23.8% 23.7% 25.5% 26.5% 27.5% 28.5% 29.5%
Postpaid 10,243 12,669 13,069 14,318 15,531 17,502 19,330 21,146 22,785 9.2%
Prepaid 41,394 47,710 52,170 54,386 54,470 54,818 55,140 55,461 55,750 0.6%
ARPU (R$/m onth) 18.7 17.4 15.8 15.0 14.9 14.7 14.7 14.6 14.7 -0.1%
% of Data 15.0% 18.9% 22.9% 26.5% 31.0% 36.0% 40.8% 45.4% 49.4%
RGUs (000's) 18,606 23,588 28,587 32,683 36,723 40,720 44,537 48,133 51,389 8.1%
Landline 7,935 9,158 10,280 11,188 12,090 12,945 13,730 14,426 15,012 5.1%
Broadband 3,770 4,661 5,752 6,689 7,578 8,471 9,343 10,164 10,905 8.8%
Pay TV 6,901 9,770 12,554 14,806 17,055 19,304 21,464 23,543 25,471 9.7%
31
COMPANY REPORT
Colombia
The company is an integrated, full-service provider of telecommunication services

in Colombia, offering wireless, fixed-line, broadband and pay TV services through the
Claro brand. The company is the largest mobile, fixed-broadband and pay TV service
provider in Colombia in terms of subscribers.
AMX is the leader in the mobile segment, with a market share of ~56% and 29.3mn
of subscribers in 3Q14. The prepaid segment is also the most important, accounting for
80% of the total subscribers. However, the company has been much more restrictive
about expanding its base of prepaid subscribers after being subjected to asymmetric
MTRs. Since the beginning of 2013, the company has had asymmetric MTRs, paying an
MTR of US$0.04/min for outgoing calls and receiving US$0.02/min for incoming calls,
which should persist until 2015, after a glide path reduction. In addition, the companys
predominant player status has prevented it from participating in certain spectrum
auctions. Thus, it was unable to acquire the 1.7/2.1 GHz and ended up acquiring the 2.5
GHz spectrum to provide 4G, while its competitors acquired better spectrums. Meanwhile,
the government has recently imposed new quality measures and prohibited carriers from
locking customers in postpaid contracts, limiting flexibility to subsidize customers. The
prohibition should help the company improve its margin, but may undermine its growth
potential, especially for data services which are driven by greater penetration of
smartphone devices, which are more expensive. Finally, AMXs 850 MHz concession has
expired recently and has not been renewed yet, which should be conditioned to a cash
payment. AMX is also a relevant player in the fixed business, being in first place in
terms of market share in the main services, with 5.2mn subscribers in 3Q14.
6.3%
4.9%
25.4%
4.1%
22.8%
5.0%
84.7% 2.6%
0.9%
Wireless Landline
26.6%
21.1% 24.1%
17.8%
46.7%
14.8%
8.7%
17.4%
Wireless Voice Wireless Data -0.8%
32
COMPANY REPORT
Market Overview
Figure 61: Wireless Subscribers (000s) Figure 62: Wireless Market Share
9.0% 11.7% 12.4% 13.5%

15.2%
6.2%
3.9%
2.5% 22.5% 24.7% 23.9%
54,822 24.1%
49,066 50,295
44,478 46,200
65.8% 62.4% 61.9% 57.6%
2010 2011 2012 2013 2014 2010 2011 2012 2013
Subscribers Growth YoY Claro Movistar TIGO - Milliocom Others
Source: MinTIC and Bradesco Corretora estimates Source: MinTIC and Bradesco Corretora estimates
Figure 63: Wireline Subscribers (000s) Figure 64: Wireline Market Share in 2013
18.6%
22.6%
7,186 7,127 7,041 7,133 7,347
16.6%
1.3% 3.0%
-0.8% -1.2% 20.7%
2010 2011 2012 2013 2014 21.4%
Subscribers Growth YoY UNE - Millicom Movistar ETB Telmex Others
Figure 65: Broadband Subscribers (000s) Figure 66: Broadband Market Share in 2013
25.3%
9.3%
16.6% 15.1%
10.0% 11.5%
32.9%
4,947
4,498
3,907
3,352
2,676
19.5%
2010 2011 2012 2013 2014 26.8%

Claro UNE - Millicom Movistar ETB Others
Subscribers Growth YoY
Figure 67: Pay TV Subscribers (000s) Figure 68: Pay TV Subscribers in 2013
10.3% 11.3% 7.8%

8.3% 7.2%
7.0%
4,995
4,668
4,310
3,872 43.7%
3,510 18.6%
2010 2011 2012 2013 2014 22.7%

Claro EPM DIRECTV Movistar Others
Subscribers Growth YoY
33
COMPANY REPORT
Estimates
We expect the company to resume top-line growth after the end of asymmetric
MTR charges in 2015, as its competitors will lose this important competitive
advantage. However, we expect a sharp decline in handset sales in 2015, due to the
prohibition of locking customers in postpaid plans, which makes any subsidy policy
prohibitive. Thus, we expect a slight uptick in margins in 2015.

COP Million 2010 2011 2012 2013 2014 2015 2016 2017 2018 CAGR15-18
Net Revenue 7,580 8,694 9,998 10,827 11,178 10,616 10,840 11,144 11,559 2.9%
Equipment Revenues 720 813 948 1,356 1,650 1,015 1,050 1,090 1,130 3.7%
EBITDA 3,438 4,101 4,660 4,789 4,540 4,417 4,511 4,637 4,810 2.9%
EBITDA Margin - % 45.4% 47.2% 46.6% 44.2% 40.6% 41.6% 41.6% 41.6% 41.6%
Postpaid 4,186 4,755 5,352 5,715 5,961 6,260 6,564 6,874 7,190 4.7%
Prepaid 25,078 24,064 25,020 23,263 23,621 23,920 24,224 24,534 24,850 1.3%
ARPU (P$/m onth) 14.6 17.4 20.0 21.4 20.4 19.6 19.3 19.3 19.6 -0.1%
% of Data 12.1% 16.0% 20.4% 25.1% 27.1% 30.4% 33.4% 36.1% 38.4%
RGUs (000's) 2,988 3,549 4,195 4,749 5,357 5,904 6,380 6,746 7,094 6.3%
Landline 571 774 986 1,206 1,435 1,635 1,782 1,852 1,907 5.3%
Broadband 614 875 1,190 1,449 1,725 1,983 2,222 2,422 2,616 9.7%
Pay TV 1,802 1,899 2,019 2,093 2,198 2,286 2,377 2,472 2,571 4.0%
34
COMPANY REPORT
Telekom Austria
Telekom Austria Group (TKA) is the largest telecom operator in Austria, and the
second-largest mobile operator in the six other markets where it operates (except
for the Republic of Serbia). The company operates through different brands in each
market, and has over 23mn subscribers and 16.4k employees as of 3Q14. Austria, TKAs
home market, is the most important market for the company, accounting for 61.0% of its
revenues and 58.2% of its EBITDA in 9M14. In the Austrian market, the company
operates through the A1 brand, which is a fully-convergent operator providing integrated
fixed services (landline, broadband and pay TV) and mobile services. In the other
markets, either TKA has more recently started to offer convergent packages, or it intends
to start providing them with the development of its network, while it is one of the leading
mobile operators.
Figure 70: Telekom Austrias Footprint Figure 71 Market Share and Subscribers (000s) as of 3Q14
Source: Telekom Austria
Figure 72: Breakdown of Revenues by Country in 9M14 Figure 73: Breakdown of EBITDA by Country in 9M14
12.2% 10.2%
9.2% 13.2%
9.4% 7.2%
58.2%
61.0%
9.3% 11.0%
Austria Bulgaria Croatia Belarus Other Markets

Austria Bulgaria Croatia Belarus Other Markets
Source: Telekom Austria and Bradesco Corretora Source: Telekom Austria and Bradesco Corretora estimates
Includes Slovenia, Republic of Macedonia, Republic of Serbia and Liechtenstein Includes Slovenia, Republic of Macedonia, Republic of Serbia and Liechtenstein
TKA has heavily invested in the countries where it operates, to enhance its leading
position. The company has purchased a sizable spectrum in Austria (50% of the total
frequency), and has also participated in spectrum auctions in Croatia and Slovenia.
35
COMPANY REPORT
Meanwhile, it has extended some of its main spectrum licenses in Bulgaria. These
spectrums should help the company continue to improve the quality of its network in the
most important segment by revenues. TKA is known for its quality services in Austria,
having the best network in the country. Thus, it has a very large market share among
postpaid customers.
Figure 74: % of Total Spectrum Held in Austria
The company has increasingly focused on convergence by combining fixed and

mobile services in Austria, Bulgaria, Croatia, and the Republic of Macedonia. As of
3Q14, the company had more than one million customers contracting convergent
packages. This strategy has helped TKA reduce its mobile customer churn by 40% in
Austria, compared to single-play customers. Furthermore, it has helped the company
curb the decline of the fixed-line business in Austria. Thus, the company should use
EUR400mn of the EUR1.0bn in proceeds from the recent capital increase to accelerate
the roll-out of its fiber network in 2015-2017, with the purpose of covering more than 70%
of households with a fixed broadband speed above 30 Mbps. The company believes that
by offering premium offers, it will be able to further reduce customer churn, capture cross-
selling and up-selling opportunities, and attract new high-value customers.
Figure 75: Target of Household Coverage by Broadband Speed Figure 76: Drop in Mobile Churn with Convergence Bundles
(6M14)
~40% ~25%
69%
1.40%
1.30%
1.10%
1.00%
0.90%
0.80%
~30% ~30%
~25% 26%
~10%
3% 2%
< 16 Mbps 30 Mbps 50 Mbps 100 Mbps Austria Croatia

FY14 Rolling-out Target 2018 Single Play Multi Convergent
Source: Telekom Austria and Bradesco Corretora Source: Telekom Austria and Bradesco Corretora estimates
36
COMPANY REPORT
TKA will likely continue to pursue M&A opportunities after strengthening its
balance sheet with the EUR1.0bn capital increase. The company has a good track-
record in M&A, focusing on reinforcing its convergence offers, consolidating the markets
in which it operates, and entering new markets. For instance, TKA acquired a fixed-line
operator in the Republic of Macedonia in July 2014, complementing its mobile operation.
In addition, it acquired YESSS!, a discount mobile operator in Austria, to strength the
companys positioning in the low-income segment. Nevertheless, any M&A would be
subject to the maintenance of the companys credit ratings (BBB stable) in order to
keep its financial flexibility in the long term.
The company has also done notable work in optimizing the efficiency of its
operations. TKA reduced its opex and capex by EUR500mn between 2009 and 2013,
and expects to cut them by an additional EUR100mn in 2014. Good cost control has
enabled the company to reduce operating expenses in the last three years, despite a
substantial increase in handset costs between 2011 and 2013, and an unfavorable
employee structure in Austria, which prevents the company from reducing headcount and
establishes a mandatory salary increase each year. Moreover, Amrica Mvils expertise
in the industry should help TKA adopt best practices and deploy procurement to gain
purchasing scale.
Figure 77: Gross Cost Savings Achieved and Expected Figure 78: Evolution of Main Cost Lines
168 CAGR11-13 YoY
3,028 2,956 2,984 -0.7%
118 442 475 547 +11.3%

2,160 -5.3%
101 100 2,045
805 833 846 376 -9.1%
+2.5% 342
71
618 626
55 +1.3%
1,781 1,648 1,590 -5.5% 1,166 1,078
-7.6%
2011 2012 2013 9M13 9M14

2009 2010 2011 2012 2013 2014e
Other Operating Expenses Payroll Materials
Source: Telekom Austria and Bradesco Corretora Source: Telekom Austria and Bradesco Corretora
Market Overview
The competitive environment in Austria remains tough, despite consolidation of

the mobile market. Tough competitive conditions persist, with substantial pricing
pressure in mobile and data services, weighing down on TKAs top-line growth. As a
result, telecom prices in Austria are among the lowest in the European market.
The Austrian mobile segment has one of the highest penetration rates in mobile
communication in Europe (at 158% at YE13). Therefore, most of the sectors growth
comes from data revenues growth, as migration from fixed to mobile is offset by the tough
competition, which drives down the price per minute. For instance, mobile broadband
subscribers grew by 14.4% in 2013. In the mobile segment, there are three main
operators: TKA, with a market share of 41%, T-Mobile, with 31%, and Hutchison Drei
Austria, with 26%, after acquiring Orange Austrias operation. Moreover, UPC should
start offering MVNO after Hutchison Drei Austria was required to allow MVNOs in its
infrastructure as part of the merger clearance condition required by the government.
The fixed-line segment is also matured, but there are still growth opportunities in
the fixed broadband and pay TV segments. However, traffic in the fixed telephony
37
COMPANY REPORT
business continues to decline in the double digits. In the fixed business, A1s main
competitor is Tele2, which provides fixed voice and has a market share of 22.3%, and
UPC, which offers fixed broadband with a market share of 21.7% as of 3Q14.
Figure 79: Market Share by Segment in Austrian Market
Figure 80: Mobile Penetration TKAs Addressable Market
156.2%
148.6%
131.0%
123.1%
117.6%
110.8% 111.4% 108.1%
Austria Bulgaria Croatia Belarus Slovenia Republic of Republic of Liechtenstein

Serbia Macedonia
Source: Telekom Austria and Bradesco Corretora
Figure 81: TKAs Mobile Market Share
79% 81% 79%

70%
52% 50%
41% 44% 43%
38% 36%
30% 28%
22%
16%
n.a
Austria Bulgaria Croatia Belarus Slovenia Republic of Republic of Liechtenstein

Serbia Macedonia
Total Market Postpaid
Source: Telekom Austria and Bradesco Corretora
38
COMPANY REPORT
Recent Regulatory Changes and Consolidation Events
As Austria is a member of the European Union, besides being regulated by Telekom-

Control Commission (TKK), the Austrian regulatory agency, Telekom Austria is also
regulated by the European Commission, which has been regulating with the bias to unify
the telecommunication sector across the European Union.
The European Commission (EC) has proposed completely abolishing active

roaming charges in the European Union by YE15. This measure still depends on the
approval of the Council of the European Union, but it seems that it is likely to be
approved. It is also awaiting approval for net neutrality, new and harmonized consumer
rights, and harmonized spectrum assignment. The new regulation should have a negative
impact on TKAs results. Nevertheless, it is worth noting that the EC had proposed
harsher measures, including the end of international fees charges, although this was
rejected by the European Parliament. The rejected proposal would have heightened
pressure on rates, and could have led to a decrease in TKAs market share.
The Balkan countries have also announced plans to pursue the establishment of a
Balkan roaming zone with significantly-reduced prices for roaming. The objective is
to have a glide path decline in roaming fees adjusting to EU standards within three years.
If approved, this initiative would also have a negative impact on TKAs revenues and
profitability.
The Austrian telecom market has undergone a consolidation wave in the mobile
segment. Hautchison 3G acquired Orange Austria in late 2012, and the market went
from four players to three. Moreover, as a result of the remedies required for approval of
the deal between Hautchison and Orange, TKA acquired mobile operator YESSS!,
frequencies, and base station sites owned by Orange.
Estimates
We expect that the companys focus on convergence and sizable network investments to
improve the quality of its broadband will help TKA curb the decline in its top-line growth in
the coming years, making net revenues flat on a YoY basis in 2018, compared to a
~4.0% decline in 2014. Moreover, we expect very good cost discipline to enable TKA to
keep its EBITDA margin stable, and even improve somewhat, despite the top-line
decrease.

EUR Million 2013 2014 2015 2016 2017 2018 CAGR15-18
Net Revenue 4,184 4,021 3,920 3,834 3,804 3,794 -1.1%
Wireless Revenues 2,810 2,759 2,700 2,628 2,613 2,594 -1.3%
Service Revenues 2,510 2,421 2,360 2,290 2,244 2,222 -2.0%
Equipment Revenues 300 338 340 338 368 372 3.1%
Fixed Line and Other Revenues 1,395 1,262 1,221 1,206 1,191 1,201 -0.5%
EBITDA 1,287 1,353 1,340 1,311 1,300 1,297 -1.1%
EBITDA Margin - % 30.8% 33.6% 34.2% 34.2% 34.2% 34.2%
Mobile Subscribers (000's) 20,020 19,853 19,655 19,460 19,655 19,852 0.3%
Postpaid 13,940 13,921 13,753 13,586 13,752 13,920 0.4%
Prepaid 6,080 5,933 5,903 5,873 5,903 5,932 0.2%
ARPU (/m onth) 10.4 10.2 10.0 9.8 9.6 9.4 -2.0%
RGUs 4,344 4,378 4,413 4,448 4,484 4,520 0.8%
39
COMPANY REPORT
Central America and the Caribbean (CAC)
AMX is the largest wireless provider in Nicaragua and the second largest in El
Salvador, Guatemala, Honduras, the Dominican Republic and Puerto Rico. It is also
the fourth largest in Panama and has wireless operations in Costa Rica. In these
countries, AMX posted 19.4mn mobile subscribers in 3Q14, corresponding to 6.7% of its
total mobile subscriber base, with 83% of its customers being prepaid. In the fixed
business, AMX has a sizeable operation with 6.8mn fixed RGUs and fixed-telephony is
the most important service. We should note, however, that pay TV is the fastest growing
activity.
4.9% 14.8%
5.4%
16.3%
9.9%
3.4%
73.5% 2.6%
1.3%
Wireless Landline
17.3%
33.4%
40.4%
2.2% 2.4%
4.1% -2.1%
22.0%
-5.9%

USD Million 2010 2011 2012 2013 2014 2015 2016 2017 2018 CAGR15-18
Net Revenue 3,510 3,656 3,844 3,886 3,928 4,054 4,193 4,354 4,525 3.7%
Equipment Revenues 173 194 176 177 162 201 208 213 219 2.8%
EBITDA 1,184 1,177 1,085 1,292 1,317 1,358 1,405 1,459 1,516 3.7%
EBITDA Margin - % 33.7% 32.2% 28.2% 33.2% 33.5% 33.5% 33.5% 33.5% 33.5%
Postpaid 2,100 2,421 2,876 3,162 3,311 3,352 3,683 4,021 4,365 9.2%
Prepaid 15,317 16,103 18,243 19,824 15,968 15,975 16,033 16,093 16,154 0.4%
ARPU (US$/m onth) 6.6 8.3 8.5 8.0 8.7 9.7 10.0 10.3 10.6 3.1%
% of Data 26.7% 30.4% 34.4% 38.2% 39.8% 42.0% 45.3% 47.9% 50.1%
RGUs (000's) 5,374 5,781 6,061 6,504 6,968 7,402 7,795 8,135 8,408 4.3%
Landline 3,788 3,866 3,959 4,126 4,269 4,374 4,439 4,459 4,436 0.5%
Broadband 935 1,064 1,194 1,299 1,413 1,523 1,627 1,721 1,804 5.8%
Pay TV 652 850 908 1,080 1,285 1,504 1,729 1,954 2,169 13.0%
40
COMPANY REPORT
Argentina, Paraguay and Uruguay (APU)
AMX said that it is the largest wireless provider in Argentina and the third largest in
Paraguay and Uruguay in YE13. The company has established nationwide coverage in
these countries and achieved 22.0mn mobile subscribers in 3Q14, mainly in Argentina.
Moreover, 87% of the mobile subscribers in this period were in the prepaid segment and
this percentage has remained stable during the last four years. However, AMX has been
posting solid mobile revenue growth in this region. As the number of subscribers and
MOUs have stayed flattish, we believe that the positive performance can be explained by
Argentinas high inflation that has soared above 30% a year. AMX recently also acquired
a 4G spectrum license in Argentina for an estimated US$282mn. In the fixed business,
AMX only has 593k subscribers, with pay TV services being the main growth driver.
0.7% 0.7% 1.3%

30.8%
29.1%
19.2%
97.3% 2.2% 2.6%

Wireless Landline
Figure 90: Revenues Breakdown in 2014 Figure 91 Revenues CAGR 2011-14 Constant Currency
6.8%
62.5%
23.8%
48.9% 38.8%
34.2%
27.0%
14.3%
20.5%


ARS Million 2010 2011 2012 2013 2014 2015 2016 2017 2018 CAGR15-18
Net Revenue 9,859 11,818 14,557 17,582 24,196 32,998 44,443 59,367 79,308 33.9%
Fixed Line and Other Revenues 584 684 891 1,144 1,654 2,367 3,387 4,801 6,719 41.6%
EBITDA 4,113 4,685 4,988 5,683 7,786 10,616 14,298 19,099 25,514 34.0%
EBITDA Margin - % 41.7% 39.6% 34.3% 32.3% 32.2% 32.2% 32.2% 32.2% 32.2%
Postpaid 2,499 2,752 2,868 2,947 2,932 3,310 3,697 4,091 4,493 10.7%
Prepaid 17,138 17,992 18,390 19,270 19,184 19,250 19,319 19,388 19,459 0.4%
ARPU (P$/m onth) 30.2 41.1 46.9 52.3 63.9 82.3 107.1 137.4 176.2 28.9%
% of Data 15.3% 19.0% 22.9% 26.5% 29.6% 30.6% 31.8% 31.8% 31.8%
RGUs (000's) 216 306 437 548 625 707 791 875 955 10.5%
Landline 72 98 139 160 166 172 177 182 186 2.8%
Broadband 44 71 110 131 154 178 203 229 255 12.7%
Pay TV 100 137 188 257 306 357 410 463 513 12.8%
41
COMPANY REPORT
Ecuador
AMX is the largest mobile carrier in Ecuador, having a small fixed business that
provides fixed telephony, broadband and pay TV services. The company has a
leading position in the mobile segment, with a market share of 68% and 12.3mn mobile
subscribers in 3Q14 under the Claro brand, covering ~96% of the population using GSM
and 3G technologies. Prepaid subscribers account for roughly 80% of the total subscriber
base, but the customer mix has been gradually improving, shifting towards postpaid
plans. Prepaid customers accounted for 87.5% of the total in 2013.
AMX was sued by Ecuadorian regulatory authorities for alleged monopolistic

practices in five locations, where the company is suspected of having exclusive rights
to deploy its network. Nevertheless, the company challenged the lawsuit and the court
dismissed the lawsuit. However, regulatory risk should be an issue, given tougher
measures also adopted by other Latin American countries. Nevertheless, the company
continues to invest in its network to provide better quality and have better coverage,
especially in rural areas.
In the fixed business, the company had 336k RGUs in 3Q14, with double-digit growth
in all services, although the operation is still small.
1.3% 0.8% 0.7% 41.4%
31.6%
9.7%
3.7% 4.2%
97.2%
Wireless Landline
3.6%
11.3% 26.3%
25.2%
50.9%
34.2% 7.4%
2.7%
-0.4%
42
COMPANY REPORT
Market Overview
12.4%
7.7%
5.3% 3.7% 2.5% 28% 28% 28% 29% 29%
17,621 18,066
16,984
14,963 15,763
13,316
70% 70% 70% 69% 68%
2009 2010 2011 2012 2013 2014e 2009 2010 2011 2012 2013
Subscribers Growth YoY Claro Movistar CNT
Source: Supertel and Bradesco Corretora estimates Source: Supertel and Bradesco Corretora estimates
Estimates

USD Million 2010 2011 2012 2013 2014 2015 2016 2017 2018 CAGR15-18
Net Revenue 1,224 1,394 1,560 1,721 1,727 1,771 1,832 1,893 1,951 3.3%
Fixed Line and Other Revenues 23 32 47 58 63 67 72 76 81 6.4%
EBITDA 657 773 731 756 781 801 829 856 882 3.3%
EBITDA Margin - % 53.7% 55.5% 46.9% 43.9% 45.2% 45.2% 45.2% 45.2% 45.2%
Postpaid 1,324 1,657 2,036 2,306 2,470 2,682 2,897 3,117 3,342 7.6%
Prepaid 9,300 9,401 9,721 9,725 9,871 9,909 9,947 9,985 10,025 0.4%
ARPU (US$/m onth) 6.9 9.0 9.6 10.0 10.1 10.2 10.3 10.5 10.5 1.1%
% of Data 21.2% 24.8% 29.5% 36.5% 40.2% 43.8% 46.7% 48.9% 50.4%
RGUs (000's) 108 174 248 311 354 399 448 497 539 10.6%
Landline 34 70 129 159 160 159 154 146 136 -5.0%
Broadband 25 38 58 80 107 138 179 222 265 24.1%
Pay TV 49 66 60 72 87 101 116 128 139 11.0%
43
COMPANY REPORT
Peru
AMX is the second-largest telecom company in Peru, with a solid mobile operation,
and being the challenger in the fixed business. The company had 12.3mn mobile
subscribers in 3Q14 with a market share of 40%, which has been a bit volatile in the last
two years due to a large number of disconnections for its main competitor (Movistar) and
itself. The proportion of postpaid customers is better than in the other Latin American
countries where it operates, accounting for 31% of the total subscriber base with strong
improvement in recent years, as postpaid customers accounted for 13% of the subscriber
base at YE10. The better customer mix has been achieved through more-aggressive
subsidies (especially for smartphones), enhanced coverage, and the development of its
4G coverage. As of YE13, AMX covered ~77% of the population, and it covered nine of
the largest cities in Peru with 4G technology in 3Q14, even though it did not win spectrum
licenses in the most recent auction, and had to adapt its spectrum to provide LTE. The
government should auction three 700 MHz spectrum licenses in 2015 to provide LTE,
and has already opened the matter for public comment. Nextel, which has a market share
of ~5%, was recently acquired by Entel, and Viettel has recently launched its mobile
operation (Bitel). The new players should lead to tougher competition and lobby for
regulatory changes (e.g. reduction in the MTR). Recently, the Peruvian regulatory agency
(OSIPTEL) banned handset locking effective 2015, which should jeopardize the
companies subsidy policies and spur mobile portability.
In the fixed business, the company had 1.2mn RGUs in 3Q14, with growth surpassing
20% as AMX gains market share from Telefnica, the incumbent telecom provider. The
company has posted solid growth in all fixed services (fixed telephony, broadband and
pay TV), driven by a convergence plan and higher investments.
2.4% 2.0%
4.6% 31.8% 31.0%
5.0%
3.8%
91.0%
1.3%
Wireless Landline
13.4%
29.2%
12.8%
50.4%
16.2%
13.7%
11.4%
23.4% 6.9%

44
COMPANY REPORT
Market Overview
17.9% 17.4%
11.4% 3% 4% 4% 6% 5%
5.5%
2.0%
-9.1% 51% 55%

63% 64% 62%
32,305 31,590
29,003 29,370 29,954
24,702
44% 40%
33% 33% 34%
2009 2010 2011 2012 2013 2014e 2009 2010 2011 2012 2013
Subscribers Growth YoY Claro Movistar Nextel - Entel
Source: OSIPTEL and Bradesco Corretora estimates Source: OSIPTEL and Bradesco Corretora estimates
3.1% 4.5%
5% 8% 12% 15% 17%
-0.5% 0.0% 0.0% -0.6%
2,965 2,950 2,951 3,084 3,084 3,065

94% 90% 86% 83% 81%
2009 2010 2011 2012 2013 2014e 2009 2010 2011 2012 2013
Subscribers Growth YoY Telefnica AMX Others
27.3% 2% 1% 1%
2%
19.1% 18.9% 7% 9% 10% 13%
12.2% 11.0% 9.7%
1,741
1,587
1,430
1,202 91% 90% 89% 86%
945
793
2009 2010 2011 2012 2013 2014e 2010 2011 2012 2013
Subscribers Growth YoY Telefnica Claro Others

15.7%
13.4% 9% 7% 8% 8%
12.3% 11%
9.7% 5% 7% 10% 15%
4%
3.9% 4.8% 6% 11% 13% 12%
15%
1,448 1,517
1,320
1,175
978 1,015
46% 46% 54% 61% 62%
2009 2010 2011 2012 2013 2014e 2009 2010 2011 2012 2013
Subscribers Growth YoY Telefnica Claro Direct TV Others
45
COMPANY REPORT
Estimates

PEN Million 2010 2011 2012 2013 2014 2015 2016 2017 2018 CAGR15-18
Net Revenue 3,116 3,595 4,364 4,863 5,283 5,768 6,243 6,618 6,981 6.6%
Fixed Line and Other Revenues 433 511 505 592 706 811 911 1,003 1,113 11.2%
EBITDA 1,345 1,675 1,867 1,842 1,959 2,139 2,316 2,455 2,590 6.6%
EBITDA Margin - % 43.2% 46.6% 42.8% 37.9% 37.1% 37.1% 37.1% 37.1% 37.1%
Postpaid 1,248 1,889 2,683 3,462 3,918 4,305 4,576 4,716 4,859 4.1%
Prepaid 8,438 9,365 10,198 8,394 8,666 9,053 9,324 9,464 9,607 2.0%
ARPU (P$/m onth) 17.4 22.0 22.9 25.4 26.6 27.1 28.1 28.9 29.7 3.1%
% of Data 17.2% 20.8% 24.8% 28.2% 31.7% 34.7% 36.9% 38.8% 40.4%
RGUs (000's) 436 690 873 1,032 1,248 1,479 1,717 1,950 2,166 13.6%
Landline 137 279 455 527 639 755 870 976 1,065 12.2%
Broadband 99 150 206 265 338 420 509 603 695 18.3%
Pay TV 200 261 212 240 271 304 338 372 405 10.1%
46
COMPANY REPORT
The United States
AMX is the largest prepaid mobile provider in the US and the fifth largest operator
in terms of subscribers. The company operates through four brands, of which TracFone
is the most important, while StraightTalks all-you-can-eat plans, have been helped by the
Walmart distribution agreement and this continues to be the main revenue growth driver.
The company reached 25.9mn prepaid subscribers in 3Q14 with a market share of ~36%
at YE13 (considering the Star Wireless Group acquisition in January with 1.4mn
subscribers). The company operates via MVNO and therefore it does not have any
wireless telecommunication network or spectrum licenses in the US. Instead, it operates
by purchasing airtime through agreements with all of the major wireless service providers
in this market, which enables it to obtain nationwide coverage and attend basically the
entire US population, with a low capex. TracFone sells its handsets and airtime cards in
more than 90k retail locations in every state across the country, as well as in Puerto Rico.
AMX has a distribution agreement with WalMart.
Figure 113: Breakdown of Revenues in 2014 Figure 114: Revenue Growth CAGR11-14 (in Constant Currency)
7.3%
35.4%
30.7% 22.7% 21.8%

18.0%
62.1%
Voice Data Equipment

Voice Data Equipment Total
Figure 115: Wireless Subscribers (million) - US Figure 116: AMXs Market Share in Mobile Prepaid Segment
6.6%
5.7% 39.7%
3.7% 3.3% 2.8%
33.4%
31.7% 31.6%
29.0%
326 336
316
286 296
68 76 75
46 45
240 252 248 250 260
2009 2010 2011 2012 2013
Prepaid Postpaid Growth YoY 2009 2010 2011 2012 2013

Source: CTIA and Bradesco Corretora estimates Source: CTIA and Bradesco Corretora estimates

USD Million 2010 2011 2012 2013 2014 2015 2016 2017 2018 CAGR15-18
Net Revenue 2,812 3,806 4,800 6,042 6,874 7,512 8,008 8,502 8,983 6.1%
EBITDA 261 334 508 548 720 788 840 892 942 6.1%
EBITDA Margin - % 9.3% 8.8% 10.6% 9.1% 10.5% 10.5% 10.5% 10.5% 10.5%
ARPU (US$/m onth) 10.9 15.1 17.0 19.4 20.4 21.4 22.5 23.5 24.4 4.4%
% of Data 30.7% 32.5% 34.5% 41.7% 44.2% 47.0% 49.5% 51.7% 53.5%
47
COMPANY REPORT
Chile
AMX is the third-largest mobile operator in Chile, and has a greenfield fixed-
business that is still maturing, providing fixed telephony, broadband and pay TV
services.
The company has nationwide mobile coverage and had 5.7mn mobile subscribers
in 3Q14, a figure that has been essentially flat over the last three years due to AMXs
stricter clean-up policy after a sharp reduction of 75% that went into effect in January
2014. With the greater number of disconnections in the prepaid segment, the company
has been improving its customer mix, with postpaid customers accounting for 24% of the
total number of subscribers (+260bps YoY). On the regulatory front, the government also
restricted differentiated rates between on-net and off-net calls since the beginning of
2014, which reduced the club effect for on-net communities and forced competition into
other variables such as network, quality, customer service and branding. Meanwhile, for
the fixed-telephony business, the regulatory authority required companies to sell each
bundled service separately, limiting the flexibility of their commercial strategy.
In the fixed-telephony business, the company had 1.24mn customers in 3Q14, with
growth in the high single digits, boosted by strong net additions in pay TV. Moreover,
AMX has invested in enterprise solutions and recently launched a new data center.
Nevertheless, the company still has low margins in this country, due to the small scale
and the roll-out of its fixed operation. Thus, the company has been focusing on gaining
scale, and subsequently improving margins.
9.5% 12.3%
4.2%
4.7%
6.2%
1.6%
0.5%
81.6%
Wireless Landline -0.5%
32.2%
32.7% 25.3%
35.9%
10.4% 10.5%
11.8%
19.5%
Wireless Voice Wireless Data 0.0%

48
COMPANY REPORT
Market Overview
20.7%
11.2% 12.4%
7.3%
42% 41% 39% 38% 38%
-1.2% -0.1%
23,941 23,663 23,630

22,315
19,852
36% 37% 37% 37%
16,450 38%
20% 22% 23% 24% 22%
2009 2010 2011 2012 2013 2014e 2009 2010 2011 2012 2013
Subscribers Growth YoY Claro Entel Movistar Nextel Others
Source: Subtel and Bradesco Corretora estimates Source: Subtel and Bradesco Corretora estimates
5% 5% 7% 7% 8%
0.9%
-0.1%
18% 18% 20%
-2.5% -2.4% 21% 22%
-2.7% -2.6%
7% 7% 6% 6% 6%
11% 10% 10% 10% 10%
3,555 3,458 3,366 3,281 3,203 3,200
57% 56% 55% 53% 52%
2009 2010 2011 2012 2013 2014e 2009 2010 2011 2012 2013
Subscribers Growth YoY Telefnica GTD Entel VTR Claro Others
17.8% 8% 8% 8% 8% 8%
11.3% 6% 7% 10% 10%
7.3% 8.0% 6.9% 11%
5.1%
39% 38% 38% 37% 38%

2,455
2,186 2,297
2,025
1,695 1,820
45% 43% 42% 41% 39%
2009 2010 2011 2012 2013 2014e 2009 2010 2011 2012 2013
Subscribers Growth YoY Telefnica VTR Claro GTD ENTEL Others
5.1% 4.9% 5.8% 9.3%

18.3% 7.8% 9.4% 11.1%
15.9% 15.5% 14.9%
13.9%
7.2% 14.5% 15.9% 15.0%
4.5% 2,952 17.8%
2,556 13.2% 15.1% 16.4%
2,067 2,160 19.4%
1,929
1,664
34.9% 35.6% 36.2% 38.5%
2009 2010 2011 2012 2013 2014e 2010 2011 2012 2013
Subscribers Growth YoY VTR Telefnica Claro Direct TV Others
49
COMPANY REPORT
Estimates

CLP Million 2010 2011 2012 2013 2014 2015 2016 2017 2018 CAGR15-18
Net Revenue 455,930 547,283 720,197 786,221 739,249 771,812 822,927 884,813 954,200 7.3%
EBITDA 31,280 43,596 46,141 28,999 53,746 58,027 61,877 66,532 71,753 7.3%
EBITDA Margin - % 6.9% 8.0% 6.4% 3.7% 7.3% 7.5% 7.5% 7.5% 7.5%
Postpaid 822 1,066 1,169 1,309 1,401 1,496 1,543 1,591 1,687 4.1%
Prepaid 4,049 4,471 5,005 4,640 4,218 4,012 4,020 4,028 4,045 0.3%
ARPU (P$/m onth) 4,178.7 5,320.2 6,141.6 6,228.5 5,999.0 6,083.1 6,362.0 6,760.9 7,210.4 5.8%
% of Data 15.5% 19.1% 23.1% 26.7% 35.3% 43.8% 51.1% 56.8% 60.7%
RGUs (000's) 850 1,030 1,071 1,167 1,264 1,395 1,526 1,652 1,768 8.2%
Landline 282 329 339 340 324 324 324 324 324 0.0%
Broadband 173 241 271 279 288 312 337 364 391 7.8%
Pay TV 395 460 461 548 652 759 864 963 1,053 11.6%
50
COMPANY REPORT
Valuation
Our valuation is based on a DCF analysis, assuming a WACC of 10.1% in MXN, with a
country risk premium of 196bps (based on the country risk premium of each country
where AMX operates, weighted for its contribution to operating results), a pre-tax cost of
debt of 3.8% in USD, a cost of equity of 11.9%, and a terminal growth rate of 4.0%.
We have a Market Perform rating for AMX, with a YE15 target price of P$18.0/share
and upside potential of 13.6%, and US$26.80/share and upside potential of 26.7%
for AMX.
This implies an EV/EBITDA of 6.0x and a P/E of 13.9x for 2015.
Figure 131: WACC Summary Figure 132: Sensitivity Analysis

WACC Analysis
Risk Free 4.5%
Market Risk Premium 6.0%
Country Risk (Bps) 196
Beta 0.90 Grow th WACC
$ 18.0 9.1% 9.6% 10.1% 10.6% 11.1%
Income Tax Rate 30.0% 2.0% 17.3 15.6 14.2 12.9 11.8
3.0% 19.6 17.6 15.8 14.3 13.0
Before Tax Cost of Debt 3.8%
4.0% 22.9 20.2 18.0 16.1 14.4
Kd 2.7% 5.0% 27.7 23.9 20.9 18.5 16.4
Ke 11.9% 6.0% 35.6 29.8 25.4 21.9 19.2
FX variation 1.0%
WACC 10.1%
Perpetuity Grow th Rate 4.0%

Source: Bradesco Corretora estimates
51
COMPANY REPORT
Key Figures
Income Statement
MXN m illion 2013 2014 2015 2016 2017 2018 Company Description
Net Revenues 786,100 843,920 876,390 879,831 910,734 945,558

Cost of goods/services sold -459,864 -495,491 -511,346 -512,320 -526,855 -543,207 AMX is one of the largest
Gross Profit 326,236 348,429 365,044 367,511 383,880 402,352 telecommunication companies in the
world and is the leading operator in
SG&A Expenses -162,592 -179,049 -188,323 -188,614 -195,180 -202,522 most Latin American w here it
Other expenses -9,481 -15,909 -22,924 -22,960 -23,759 -24,653 operates. The company provides
EBIT 154,163 153,471 153,797 155,938 164,941 175,177 wireless servic es in 18 countries and
fixed services in 14 countries. In
EBITDA 255,698 271,161 284,278 286,804 297,061 308,802 addition, AMX has a stake of 21.4% in
Equity income 368 -1,785 662 924 1,056 924 KPN and a controling stake of 59.7%
in Telekom Austria.
Financial income/expense -48,072 -42,805 -27,425 -28,587 -28,193 -27,453
Operating Incom e 106,459 108,880 127,035 128,275 137,804 148,649
Income tax -31,488 -40,041 -38,110 -38,482 -41,341 -44,595
Minority Interest -350 -1,094 469 454 542 566
Net Earnings 74,621 67,746 89,393 90,246 97,004 104,620
Net Revenue P$ million
Operating Margins 2013 2014 2015 2016 2017 2018 1,000,000
Gross Margin 41.5% 41.3% 41.7% 41.8% 42.2% 42.6% 900,000
EBIT Margin 19.6% 18.2% 17.5% 17.7% 18.1% 18.5%
800,000
EBITDA Margin 32.5% 32.1% 32.4% 32.6% 32.6% 32.7%
700,000
Income tax rate -29.6% -36.8% -30.0% -30.0% -30.0% -30.0%
600,000
Net margin 9.5% 8.0% 10.2% 10.3% 10.7% 11.1%
500,000
400,000
Balance Sheet
300,000
MXN m illion 2013 2014 2015 2016 2017 2018
200,000
Current + long term assets 329,185 413,308 398,856 414,486 433,288 452,848
100,000
Cash + short term investment 48,164 89,653 79,245 89,770 101,605 113,437
0
Net receivables 230,828 263,036 259,400 263,655 269,399 275,769 2013 2014 2015 2016 2017 2018
Inventories 36,719 39,766 39,359 40,208 41,431 42,789
Other 13,474 20,853 20,853 20,853 20,853 20,853
Perm anent assets 696,408 810,174 823,539 830,538 838,932 848,895 EBITDA P$ million
Total assets 1,025,593 1,223,481 1,222,395 1,245,024 1,272,219 1,301,743
350,000
Current + long term liabilitie 815,291 1,010,971 992,475 997,509 1,005,845 1,015,010
Accounts payable 196,463 230,657 215,883 220,075 226,928 234,529 300,000
Dividends due 0 19,926 16,203 17,044 18,528 20,092
250,000
Total debt ST + LT 490,319 586,820 586,820 586,820 586,820 586,820
Other 128,509 173,569 173,569 173,569 173,569 173,569 200,000
Shareholders' equity 210,301 212,510 229,920 247,515 266,374 286,733 150,000

Total liabilities 1,025,592 1,223,481 1,222,395 1,245,024 1,272,219 1,301,743
100,000
Cash flow 50,000

MXN m illion 2013 2014 2015 2016 2017 2018
0
EBIT 154,163 153,471 153,797 155,938 164,941 175,177 2013 2014 2015 2016 2017 2018
Depreciation and Amortization 101,535 117,690 130,481 130,867 132,121 133,625
EBITDA 255,698 271,161 284,278 286,804 297,061 308,802
Changes in w orking capital -16,013 26,263 -10,730 -912 -115 -127
Income tax -46,249 -46,041 -46,139 -46,781 -49,482 -52,553 EBITDA Margin %
Capex -129,600 -150,725 -155,627 -137,866 -140,514 -143,588 32.7%
Free cash flow to the firm 63,836 100,658 71,781 101,245 106,950 112,534
32.6%
Key Indicators 2013 2014 2015 2016 2017 2018 32.5%
EPS 1.08 0.98 1.29 1.31 1.40 1.51 32.4%

P/E 14.7 16.2 12.2 12.1 11.3 10.5
32.3%
P/BV 5.2 5.2 4.8 4.4 4.1 3.8
P/Free cash flow 17.1 10.9 15.2 10.8 10.2 9.7 32.2%
Free cash flow yield 5.8% 9.2% 6.6% 9.2% 9.8% 10.3% 32.1%
Net earnings - CAGR 7% 13% 5% 6% 5% 4%
32.0%
PEG 2.2 1.3 2.3 1.9 2.1 2.5
EV/EBITDA 6.2 5.8 5.6 5.5 5.3 5.1 31.9%
EBITDA - CAGR 4% 3% 3% 4% 4% 4% 31.8%

2013 2014 2015 2016 2017 2018
EVG 1.6 1.9 2.0 1.5 1.4 1.4
EV/Sales 2.0 1.9 1.8 1.8 1.7 1.7
Sales - CAGR 4% 3% 3% 4% 4% 4%
ROE (final) 35.5% 31.9% 38.9% 36.5% 36.4% 36.5% Net Income P$ million
ROIC 14.1% 12.2% 11.9% 11.9% 12.5% 13.1% 120,000
Dividend per share (MXN) 1.25 0.78 1.03 1.04 1.12 1.21 100,000
Pay out 116% 80% 80% 80% 80% 80%
Dividend yield 7.9% 4.9% 6.5% 6.6% 7.1% 7.6% 80,000
Net debt (MXN million) 442,155 497,167 507,575 497,050 485,215 473,383 60,000
Net debt/Shareholders' equity 2.10 2.34 2.21 2.01 1.82 1.65

Net debt/EBITDA 1.73 1.83 1.79 1.73 1.63 1.53 40,000
Financial expenses/EBIT -0.31 -0.28 -0.18 -0.18 -0.17 -0.16

20,000
0
2013 2014 2015 2016 2017 2018
52
COMPANY REPORT
Analyst Certification
Each analyst responsible for the preparation and content of this report hereby certifies, pursuant to SEC Regulation AC and applicable law s and regulations of other jurisdictions, that:
(i) the view s expressed herein accurately and exclusively reflect his or her personal view s and opinions about the subject company(ies) and its or their securities;
(ii) no part of his or her compensation w as, is, or w ill be paid directly or indirectly, related to the specific recommendation or view s expressed by that analyst in this report; and
pursuant to Brazilian securities exchange commission (Comisso de Valores Mobilirios CVM) Instruction 483/10:
the recommendations indicated in this report solely and exclusively reflect his or her personal opinions, and w ere prepared independently and autonomously, including in relation
(i)
to Bradesco Corretora and its affiliates;
(ii) his or her compensation is based on the profitability of Bradesco Corretora and its affiliates, w hich includes investment banking revenues;
Company disclosures pursuant to Brazilian securities exchange commission (Comisso de Valores Mobilirios CVM) Instruction 483/10:
(i) Banco Bradesco S.A. beneficially ow ns 5% or more of equity securities issued by Cielo S.A.. Bradseg Participaes Ltda., a subsidiary of Banco Bradesco, indirectly ow ns 5% or
more of equity securities issued by Fleury S.A.. BRADESPAR S.A., w hose controlling group is comprised of the same shareholders that control Banco Bradesco S.A., indirectly ow ns
5% or more of equity securities issued by VALE S.A.
(ii) gora, Bradesco Corretora, Bradesco BBI and Bradesco Group companies have relevant financial and commercial interests in relation to the subject company(ies) or the subject
security(ies).
(iii) Bradesco BBI S.A. is acting as an underw riter in the public offering of equity securities of JBS Foods S.A.
(iv) Bradesco BBI have managed or co-managed a public offering of equity and/or debt securities for the follow ing companies w ithin the past 12 months: Abril Educao, AES Tiet,
Banco BTG Pactual, Banco do Brasil, Braskem, Comgs, Concessionria do Aeroporto Internacional de Guarulhos, Concessionria do Sistema Anhanguera-Bandeirantes, Daycoval,
Embratel, vora, JBS, Marfrig, OAS, OI, Ouro Fino Sade Animal Participaes S.A, Razen Energia, Smiles, Vale and Via Varejo.
(v) gora and/or Bradesco Corretora participated in the public offering of equity and/or debt securities for the follow ing companies w ithin the past 12 months: Comgs, Concessionria
do Aeroporto Internacional de Guarulhos, Concessionria do Sistema Anhanguera-Bandeirantes, CVC Brasil, Fras-Le, GAEC Educao, Iochpe Maxion, OI, Ouro Fino, Ser Educacional,
Tupy, Vale e Via Varejo.
(vi) Bradesco Corretora receives compensation for making a market in the equity securities of Alpargatas (ALPA4), General Shopping (GSHP3) and Helbor (HBOR3). Bradesco receives
compensation for making a market in the in the fixed income securities of BNDESPAR and USIMINAS, and shares of Fundo Imobilirio BB Progressivo II.
Important Disclosures
Company-specific regulatory disclosures
Bradesco Corretora and/or its affiliates beneficially ow n one percent or more of any class of common equity securities of the subject company(ies). This position
1
reflects information available as of the business day prior to the date of this report;
Bradesco Corretora and/or its affiliates have managed or co-managed a public or Rule 144A offering of the subject companys(ies) securities in the tw elve months
2
preceding the date of this report;
Bradesco Corretora and/or its affiliates have received compensation for investment banking services from the subject company(ies) in the tw elve months preceding the
X 3 date of publication of the research report and/or expects to receive or intends to seek compensation for investment banking services from the subject company(ies) in the
three months follow ing the date of this report;
4 Bradesco Corretora and/or its affiliates w ere making a market in the subject companys(ies) equity securities at the date of this report;
5 Any other actual material conflict of interest of Bradesco Corretora and/or its affiliates know n at the date of this report.
X
Bradesco Corretora research ratings distribution
Rating Definition Coverage BR
Outperform Expected to outperform the Ibovespa by more than 10%. 48% 98%
Market Perform Expected to perform in the range of 10% above or below the Ibovespa. 43% 100%
Underperform Expected to underperform the Ibovespa more than 10%. 1% 100%
Under Review This indicates that both the target price and the rating are currently being revised. 6% 100%
Restricted The analyst cannot express his/her view s on the company. 1% 50%
(1) Percentage of companies under coverage globally w ithin this rating category. As of 12/05/14 Bradesco Corretora had 141 companies under coverage globally.
(2) Percentage of companies w ithin this rating category for w hich [investment banking] services w ere provided w ithin the past 12 months.
Bradesco Corretora ratings

Bradesco Corretora ratings are constantly revised and any temporary inconsistencies betw een the upside potential that gave rise to any such rating and the upside potential in
connection w ith the target price are at all times deliberate. The official rating shall prevail.
Any differences betw een the rating and the target price may occur especially due to the analysts expectations to the effect that any short/medium term factors that cannot be priced-in
yet might lead to inconsistencies betw een Bradeco Corretora valuation and the stock behavior. The factors Bradeco Corretora considered include, but are not limited to: Any
expectations in connection w ith quarterly results, market conditions, ow nership issues and any expectations involving mergers and acquisitions.
The ratings reflect only the analysts expectation on the future performance of the relevant stock. A Outperform rating does not necessarily represent that the analyst approves of
the company and its management w hilst a Underperform rating does not necessarily means that the analyst has a negative view on the company. Within Bradeco Corretora coverage
universe there are sound companies, w ith good fundamentals as per the market consensus, and fair priced stock, and w ould not be Bradeco Corretora investment pick.
Price target and rating history

Price target, rating history chart(s), valuation/method used to determine price target, and our policy for managing conflicts of interest in connection w ith investment research are
available upon request. You may obtain this information by contacting your representative or by sending an email to bradescocorretora@infobradesco.com.br.
53
COMPANY REPORT
Additional Disclosures
With the exception of investment company funds, Bradesco Corretoras internal policy prohibits ow nership of securities in their respective area of coverage to analysts as w ell as to
the associates reporting to the analysts. Analysts are paid in part based on the profitability of Bradesco Corretora and its affiliates, w hich includes investment banking revenues.
Bradesco Corretora policy prohibits its analysts and associates reporting to the analysts from serving as an officer or director, advisory board member or employee of any company in
the analysts area of coverage.
The follow ing disclosures are required under or based on the law s of the jurisdiction indicated, except to the extent already made above w ith respect to United States law s and
regulations. Brazil: This report is distributed in Brazil by Bradesco Corretora. Any investor in Brazil w ho receives this report and w ishes to conduct transactions w ith stocks
analyzed herein should contact and request execution of orders through Bradesco Corretora at (55 11) 3556-3001.
United Kingdom and European Econom ic Area: In the United Kingdom and elsew here in the European Economic Area, this report may be made or communicated by Bradesco
Securities UK Limited ("Bradesco UK"). Bradesco UK is authorized and regulated by the Financial Services Authority and its registered office is at: 20-22 Bedford Row , London, WC1R
4JS. This report is for distribution only to persons w ho:
(i) are persons that are eligible counterparties and professional clients of Bradesco UK;
(ii) have professional experience in matters relating to investments falling w ithin Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (as
amended, the "Financial Promotion Order");
(iii) are persons falling w ithin Article 49 (2) (a) to (d) ("high net w orth companies, unincorporated associations etc") of the Financial Promotion Order;
(iv) are outside the United Kingdom, or
(v) are persons to w hom an invitation or inducement to engage in investment activity (w ithin the meaning of section 21 of the Financial Services and Markets Act 2000) in connection
w ith the issue or sale of any securities to w hich this report relates may otherw ise law fully be communicated or caused to be communicated (all such persons together being
referred to as "relevant persons").
This report is directed only at relevant persons and must not be acted on or relied on by persons w ho are not relevant persons. Any investment or investment activity to w hich this
report relates is available only to relevant persons and w ill be engaged in only w ith relevant persons. No public offer of any securities to w hich this report relates is being made by
Bradesco UK or Bradesco Corretora in the United Kingdom or elsew here in the European Economic Area.
United States: This report is distributed in the United States by Bradesco Securities Inc. Bradesco Securities Inc., a U.S. registered broker-dealer and a w holly-ow ned subsidiary of
Banco Bradesco S.A., is a member of FINRA/SIPC. All U.S. recipients of this report w ishing to effect transactions in securities discussed should contact and place orders through
Bradesco Securities Inc. at (212) 888-9141.
Bradesco Corretora has no officers (or persons performing similar functions) or employees in common w ith Bradesco Securities, Inc. In addition, Bradesco Securities, Inc. maintains
and enforces w ritten procedures reasonably designed to prevent Bradesco Securities, Inc., any controlling persons, officers (or persons performing similar functions), and employees
of Bradesco Securities, Inc. from influencing the activities of the analyst w ho prepared this research report and the content of this research report prepared by said analyst.
The non-US research analysts are not associated persons of Bradesco Securities, Inc. and therefore may not be subject to the NASD Rule 2711 and NYSE Rule 472 restrictions on
communications w ith a subject company, public appearances and trading securities held by a research analyst account.
Hong Kong: In Hong Kong, this report may be distributed by Bradesco Securities Hong Kong Limited (Bradesco HK). Bradesco HK is licensed by the Securities and Future
Commission (SFC) to carry on Type 1 and Type 4 regulated activities as defined in the Securities and Future Ordinance (Cap. 571 of the Law s of Hong Kong) (SFO) in Hong Kong,
subject to conditions published on the w ebsite of the SFC from time to time. Except for Bradesco HK, none of its affiliates, including Bradesco Corretora, carry out or is
licensed/authorized to carry out any regulated activities as defined in the SFO in Hong Kong and each of these affiliates is prohibited from carrying on any regulated activities, including
but not limited to dealing in securities and advising in securities (as defined in the SFO), in Hong Kong. This report is directed to you by Bradesco HK based on your interest and
preference in the relevant underlying securities that you have previously communicated to Bradesco HK. You agree that this report is not intended for the promotion of any services or
products of any of Bradesco HKs affiliates in Bradesco group, including those of Bradesco Corretora. All Hong Kong recipients of this report w ishing to effect transactions in
securities discussed should contact and place orders through Bradesco HK at (852) 22518716 or (852) 22518718.
This report is intended for distribution only to non-Hong Kong residents or professional investors as defined in the SFO. It is provided solely for informational purposes and do not
constitute an offer to buy or sell or a solicitation of an offer to buy or sell any security, product, service or investment to the public w ithin the meaning of the Companies Ordinance (Cap.
32 of the Law s of Hong Kong) or to professional investors w ithin the meaning of the SFO. It has not been review ed by the SFC or any regulatory authority in Hong Kong.
Other Countries: This report, and the securities discussed herein, may not be eligible for distribution or sale in all countries or to certain categories of investors. In general, this
report may be distributed only to professional and institutional investors.
General Disclosures
1) This report has been prepared solely by Bradesco Corretora and is being provided exclusively for informational purposes. The information, opinions, estimates and projections
constitute the judgment of the author as of the current date and are subject to modifications w ithout prior notice. Bradesco Corretora has no obligation to update, modify or
amend this report and inform the reader accordingly, except w hen terminating coverage of the issuer of the securities discussed in this report.
2) This report, including the estimates and calculations of Bradesco Corretora, is based on publicly available information that it consider reliable, but it do not represent it is
accurate or complete, and should not be relied upon as such.
3) This report is not an offer or a solicitation for the purchase or sale of any financial instrument. It is not intended to provide personal investment advice and it does not take into
account the specific investment objectives, financial situation and the particular needs of any specific person w ho may receive this report. Investors should seek financial advice
regarding the appropriateness of investing in any securities, other investment or investment strategies discussed or recommended in this report and should understand that
statements regarding future prospects may not be realized.
4) Investors should note that income from securities or other investments, if any, referred to in this report may fluctuate and that price or value of such securities and investments
may rise or fall. Accordingly, investors may receive back less than originally invested. Past performance is not necessarily a guide to future performance. Bradesco Corretora
and its affiliates do not accept responsibility for any direct or indirect loss arising due to use of this report. Investors should consider w hether any advice or recommendation in
this research is suitable for their particular circumstances and, if appropriate, seek professional advice, including tax advice. Exchange rate movements could have adverse
effects on the value or price of, or income derived from, certain investments.
5) Bradesco Corretoras and its affiliates salespeople, traders and other professionals may provide oral or w ritten market commentary or trading strategies to their clients and
their proprietary trading desks that reflect opinions that are contrary to the opinion expressed in this report. Such market commentary or trading strategies reflect the different
time frames, assumptions, view s and analytical methods of the persons w ho prepared them, and Bradesco Corretora and its affiliates are under no obligation to ensure that
such market commentary or trading strategies are brought to the attention of any recipient of this report.
6) From time to time, Bradesco Corretora or its affiliates and officers, directors and employees, not including its analysts may, to the extent permitted by law , hold long or short
positions, or otherw ise be interested in transactions in assets directly or indirectly related to this report.
7) Non-US research analysts w ho have prepared this report are not registered or qualified as research analysts w ith FINRA but instead have satisfied the registration and
qualification requirements or other research-related standards of a non-US jurisdiction.
Any additional information may be obtained by contacting your representative or by sending an email to bradescocorretora@infobradesco.com.br
No portion of this docum ent m ay be (i) copied, photocopied or duplicated in any form , or by any m eans, or (ii) redistributed w ithout prior consent from Bradesco
Corretora.
54
Bradesco Corretora Research Team
Econom ics & Research Director
Dalton Gardim am 55 112178 4275 dalto n@bradesco bbi.co m.br Denis Blum 55 112178 4224 denis@bradesco bbi.co m.br
(Chief Eco no mist) (Senio r Eco no mist)
Tarik Migliorini 55 112178 4230 tarik.miglio rini@bradesco bbi.co m.br
Head of Equity Research Telecom , Media and Technology

Carlos Firetti, CFA 55 112178 5363 carlo sfiretti@bradesco bbi.co m.br Luis Azevedo 55 112178 5321 luis.azevedo @bradesco bbi.co m.br
Tales Freire, CFA 55 112178 4527 tales@bradesco bbi.co m.br
Banking
Carlos Firetti, CFA 55 112178 5363 carlo sfiretti@bradesco bbi.co m.br Education
Bruno Chemmer, CFA 55 112178 4903 bruno .chemmer@bradesco bbi.co m.br Luis Azevedo 55 112178 5321 luis.azevedo @bradesco bbi.co m.br
Tales Freire, CFA 55 112178 4527 tales@bradesco bbi.co m.br
Financial Services
Rafael Frade, CFA 55 112178 4056 rafaelf@bradesco bbi.co m.br Consum er Goods and Retail
Gabriel Gusan, CFA 55 112178 5329 gabriel.gusan@bradesco bbi.co m.br Ricardo Boiati 55 112178 5326 rbo iati@bradesco bbi.co m.br
Healthcare Oil & Gas, Petrochem icals and Sugar & Ethanol
Rafael Frade, CFA 55 112178 4056 rafaelf@bradesco bbi.co m.br Auro Rozenbaum 55 112178 5315 auro @bradesco bbi.co m.br
Gabriel Gusan, CFA 55 112178 5329 gabriel.gusan@bradesco bbi.co m.br
Electric Utilities, Water & Sew age
Steel, Mining, Pulp & Paper Carlos Firetti, CFA 55 112178 5363 carlo sfiretti@bradesco bbi.co m.br
Alan Glezer, CFA 55 112178 5466 alanglezer@bradesco bbi.co m.br Paulo Ferreira 55 112178 5323 paulo .ferreira@bradesco bbi.co m.br
Arthur Suelotto, CFA 55 112178 6104 arthur.suelo tto @bradesco bbi.co m.br
Food, Beverages, Tobacco & Agribusiness
Transportation, Logistics and Capital Goods Gabriel Lim a 55 112178 5313 gabriel.lima@bradesco bbi.co m.br
Luiz Peanha 55 112178 5324 pecanha@bradesco bbi.co m.br Rodrigo Coelho 55 112178 5317 ro drigo .co elho @bradesco bbi.co m.br
Leandro Fontanesi 55 112178 4274 leandro .fo ntanesi@bradesco bbi.co m.br
Fixed Incom e
Hom ebuilding and Real Estate Altair Pereira 55 112178 4279 altair@bradesco bbi.co m.br
Luiz Mauricio Garcia 55 112178 4223 lmgarcia@bradesco bbi.co m.br Caio Lombardi 55 112178 4225 lo mbardi@bradesco bbi.co m.br
Andr Mazini 55 112178 5109 andre.mazini@bradesco bbi.co m.br
Each analyst w hose nam e is in bold print is the principal analyst responsible for the content of reports on the respective sector, as w ell as fulfillm ent of the
provisions of Art. 16 of CVM Instruction 483/10.
Bradesco Corretora CTVM S.A. | So Paulo
Sales - 55 11 3556 3001 Sales Trading - 55 11 3556 3001

Juvenal Neves juvenal@bradesco bbi.co m.br Head of Trading
Tiago Valent tiago valent@bradesco bbi.co m.br Orlando Cardoso o rlando cardo so @bradesco bbi.co m.br
Gabriel Takemoto gabriel.kenzo @bradesco bbi.co m.br
Renata Grosche renata.gro sche@bradesco bbi.co m.br Traders
Cssio Garcia cssio @bradesco bbi.co m.br
Sales - Fixed Incom e - 55 11 2178 6959 Fbio Brisola fabio @bradesco bbi.co m.br
Fernanda Weber Bratz fernanda@bradesco bbi.co m.br Ingrid Amorim ingrid@bradesco bbi.co m.br
Lucila Sakakura lucila@bradesco bbi.co m.br Marcio Aguiar marcio @bradesco bbi.co m.br
Mauricio Sanchez mauricio @bradesco bbi.co m.br
Sales - Local Fixed Incom e - 55 11 3556 3005 Pedro Takahashi pedro ivo @bradesco bbi.co m.br
Rogrio Queiroz ro gerio @bradesco bbi.co m.br Ricardo Copia ricardo .co pia@bradesco bbi.co m.br
Dauro Zaltman dauro @bradesco bbi.co m.br Silene Zinhani silene@bradesco bbi.co m.br
Denise Chicuta denise.chicuta@bradesco bbi.co m.br
Patricia Cruz Bilezikjian, CFA patricia.bile@bradesco bbi.co m.br Stock Loans Desk - 55 11 3556 3001
Wilson Pereira wilso n@bradesco bbi.co m.br
Traders Evandro Santos evandro .santo s@bradesco bbi.co m.br
Agnaldo Ishikava agnaldo @bradesco bbi.co m.br
Douglas Vieira Corazza do uglas.co razza@bradesco bbi.co m.br BM&F Trading Desk - 55 11 3556 3350
Eduardo Tosin Bueno eduardo .bueno @bradesco bbi.co m.br Jos Lzaro Ferreira - Head lazaro @bradesco bbi.co m.br
Joao Batista Tamassia Santos Junior jo o .batista@bradesco bbi.co m.br Lilian Osti - Commercial Manager lilian.o sti@bradesco bbi.co m.br
Marcelo Matias Boneri bo neri@bradesco bbi.co m.br
Paulo Silva do Carmo paulo .carmo @bradesco bbi.co m.br
Pedro Fonseca de Souza pedro .fo nseca@bradesco bbi.co m.br
Sandoval Marcos Iorio sando val@bradesco bbi.co m.br
Institutional Sales Team - USA, UK & HK

Bradesco Securities, Inc. | New York (FINRA/SIPC Member) Bradesco Securities Hong Kong Ltd.
Sales 01 212 888 9141 Sales (852) 2251 8716

Marcelo Cabral mcabral@bradesco securities.co m Luiz Fernando Silva luiz@bradesco securities.co m
Juan Briano jbriano @bradesco securities.co m Jae Choi jaecho i@bradesco securities.co m
DeWayne Shaw dewayne@bradesco securities.co m
Paulo Pereira paulo .pereira@bradesco securities.co m Sales - Fixed Incom e (852) 2251 8718
Vielcka Mansukhani Vielcka@bradesco securities.co m Joo Paulo Loyola jplo yo la@bradesco securities.co m
Amex Lee amexlee@bradesco securities.co m
Sales - Fixed Incom e 01 212 888 9143
Brent Matson brent@bradesco securities.co m Bradesco Securities UK, Ltd
Leonardo Jafet ljafet@bradesco securities.co m
Sales 44 207 382 0070
Sales Trading 01 212 888 9141 Robert Hulme rhulme@bradesco securities.co m
Robert Vespa ro bert@bradesco securities.co m
Christopher Barresi cbarresi@bradesco securities.co m Sales - Fixed Incom e 44 207 382 0074
Sean Harte sean@bradesco securities.co m Guilherme Zraick gzraick@bradesco securities.co m
Sebastian Almquist Tangen salmquist-tangen@bradesco securities.co m
Syndicate Desk 01 646 432 6642 Raymond Ressy ressy@bradesco securities.co m
Shin Fukui shin@bradesco securities.co m
David Pereira david@bradesco securities.co m
Av. Paulista, 1450 7 andar

CEP: 01310-917 So Paulo SP

Amx - Ic Initiation of Coverage - 12182014

Uploaded by

Document Information

Original Title

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

Amx - Ic Initiation of Coverage - 12182014

Uploaded by

Copyright:

Available Formats

INITIATION OF COVERAGE

Regulatory Concerns Tarnish AMXs Shine

Mexbol America Movil

(MXN mn) 2013A 2014E 2015E 2016E Key Figures 18-Dec-14

Investment Thesis ...................................................................................... 3

Figure 1: AMX Market Share in Mobile Segment

Figure 2: AMX Global Positioning (ex. China)

Total Access Wireless Revenues EBITDA Free Cah

Source: ITU and Bradesco Corretora Source: Bradesco Corretora

AMX has acquired control of Telekom Austria, unlocking opportunities to expand

Amrica AT&T Verizon Vodafone France Deustsche Telefnica

Source: Company and Bloomberg Source: Company and Bloomberg

Figure 7: Share Buyback/Dividend Yield

2011 2012 2013 2014e 2015e 2016e 2017e 2018e

As a multinational company with exposure in some developing markets, AMX may

Moreover, most of AMXs debt is denominated in foreign currencies. Moreover, even

AMX is trading at an EV/EBITDA15 of 5.6x, representing a discount to the

We also highlight that some international companies stocks (especially European)

In our view, although consolidation should be an upside opportunity for AMX, it

Figure 10: International Multiples Analysis

Figure 11: AMXs Footprint

Figure 12: AMXs Subsidiaries

AMXs activities worldwide reported 287mn mobile subscribers in 3Q14, making it

Brazil 46.4% Landline Broadband Pay TV

TKA 8.5% 42.3%

CAC 5.7% 15.5%

Colombia -0.8% -1.6%

TKA 10.0% 45.2%

Peru 3.0% 25.5%

Figure 23: Capex (US$bn) and Capex as % of Net Revenues

18.2% 17.9% 17.8%

2010 2011 2012 2013 2014e 2015e

Capex % of Net Revenue

Telmexs subscribers for fixed-line operation reached 22.2mn subscribers in 3Q14,

The Mexican telecom sector has been undergoing various transformational

105,006 108,156 19.3%

2009 2010 2011 2012 2013 2014e

Subscribers Growth YoY Telcel Telefnica Iusacel Nextel

2009 2010 2011 2012 2013 2014e Telmex Telefnica Televisa

12,748 13,524 13,537 13,672

2009 2010 2011 2012 2013 2014e

Subscribers Growth YoY Telmex Televisa Megacable Axtel Others

2009 2010 2011 2012 2013 2014e 19.2%

Subscribers Growth YoY Sky Dish Televisa Megacable Axtel Others

Recent Regulatory Changes

The Mexican government imposed asymmetric regulations on preponderant

The main asymmetric measures related to AMX are as follows:

Roaming: The company must provide roaming services at a national level to

Elimination of domestic roaming charges: The company will be prohibited

AMXs board of directors approved a plan on July 8 to implement various

AMXs steps to carry out divestitures are as follows:

I The company submits its plan to IFT.

V IFT may authorize AMX to provide additional services or move to a unified

Besides the asymmetric measures, the regulatory authority prohibited domestic

Spinning-off the Tower Business

Figure 37: Tower Sales Transactions Details

Figure 38: Valuation Comparison Between Telecom and Tower Companies

Figure 40: Main Estimates

AMX is an integrated and full-service provider of telecommunication services in

Wireless Voice Wireless Data

The company is also a leading provider of data communication services, renting

3.8% 1.2% 4.3% 1.1%

Figure 47: Gross Revenues (R$bn) and YoY Growth by Segment