MCOT staff will stage their first protest today against the new board of directors, following the announcement of a new policy that has led to a sharp fall in share prices and attracted negative comments that the overhaul in business policy has undermined investor confidence.

An MCOT employee said staff planned to gather at Government House today dressed in black.

The source said all of the company's staff would be wearing black shirts bearing the message: "Stop Hurting MCOT".

"We will also submit a letter to Prime Minister Surayud Chulanont to clarify our reasons for protesting against this matter and for changing the current board," said the source.

MCOT's share price has tumbled 30 per cent since September 19 military coup. It fell a great deal further last week after the new board - led by Pongsak Payakvichien, a Matichon Plc executive appointed acting president - unveiled a plan to refocus on social benefits rather than on profits.

The share price, however, rebounded 1.8 per cent yesterday to close at Bt28.25.

The source said the new board had not only damaged the company's share price, but also brought back a negative image of the company in favouring benefits to certain connected groups.

Kongkiat Opaswongkarn, Asia Plus Securities CEO and chairman of the Federation of Thai Capital Market Organisations, also commented yesterday that the overhaul of MCOT's business-management policy had undermined investor confidence.

"This has made an impact not only on MCOT itself, but also on the country as a whole," he said, adding that it would be difficult to solicit investors to snap up the stocks again, even though the company's executives had tried to explain the situation.

"In the past, MCOT was managed by professionals, and the former executives showed an outstanding performance. They've already laid down the foundations for the firm, so the policy should not be revised. However, when the change in policy was announced, it wiped out about 40 per cent of MCOT's share value. The damage has been spread out widely to people through the shareholding of the Finance Ministry and the Government Savings Bank who hold a total of 77 per cent," he said.

He called MCOT a precedent case for state enterprises, because investor confidence and sources of funding would be destroyed if its business policy were completely changed.

PM's Office Minister Thirapat Serirangsan, whose responsibilities include MCOT, said that once the appointments were endorsed by shareholders, it was within the power of the new board to consider measures they thought would improve the company's performance.

"To focus on social benefits is a good in itself, and MCOT should proceed with it," he said, but added that in practice MCOT could not entirely ignore profitability.

He also refrained from comment on rumours that the Manager Group and former senator Chirmsak Pinthong would be awarded air time. He said such rumours could be false and needed investigation.

Meanwhile, MCOT's labour union said in a statement yesterday that after an urgent meeting, it had agreed to ask the new board and executives to provide a clearer picture on management policy and arrange a meeting for all staff.

Phatra Securities said, unsurprisingly, this had given rise to concerns that MCOT's revenues would be negatively affected.

The securities firm said a decline in revenues would have a drastic impact on profits, because most costs were fixed.

"We estimate that if 2007 revenues declined 10 per cent year on year, profits would drop 25 per cent. However, we're maintaining our earnings projection and "neutral" rating on MCOT for now, because MCOT has yet to make an official announcement about its direction," said Phatra.

In addition, as Channel 3 operator BEC World and MCOT operate in the same market, the weaker MCOT becomes, the larger the windfall for BEC. Phatra said it maintained a "buy" rating on BEC, with a Bt22.56 price objective.