Converge backs underground conduits as long term network concept
From AB Capital's The Opening Bell: Three Moves
Event
CNVRG CEO Dennis Uy reiterated support for underground conduit systems and the “Dig Once” policy, citing benefits to network resilience, faster restoration, and lower disruption. This follows CNVRG’s participation in the Makati CBD underground conduit initiative.
View
The initiative remains conceptual and policy-driven rather than execution-led. However, it frames a long-term structural positive for fixed broadband economics if underground conduits are adopted at the city/district level (i.e. lower fault rates, faster restoration, and reduced recurring repair costs vs. aerial fiber.) We think this potentially improves service reliability, supports churn management and enterprise credibility.
Catalyst
Viability will hinge on LGU coordination and cost-sharing under Dig Once. We think a telco-led rollout would likely be uneconomic given high upfront capex.
Action
We do not view this as a rerating catalyst, but it highlights CNVRG’s push and participation in future-proof urban infrastructure, offering potential long-term optionality to monitor. CNVRG remains our top telco pick (O/P, TP P22).
Disclaimer: The information, analyses, and views contained herein is based on sources which we, AB Capital Securities, believe are reliable, but is not guaranteed by us and is not to be considered all inclusive. It is not to be construed as an offer or solicitation of an offer to sell or buy the securities herein mentioned. AB Capital Securities and its Directors and Officers and/or members of their families may have a position in the securities herein mentioned and may make purchases and/or sales of the securities from time to time in the open-market and otherwise.
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