Vice president for finance Tanadit Charoenchan said yesterday that the brighter prospects arose from expected growth in sales of iPSTAR broadband satellite services in the Asia-Pacific region, particularly in China, Australia and Thailand.

The company's brighter prospects were announced a day after Singapore Foreign Minister George Yeo said Singapore would not object if state-owned investment company Temasek Holdings decided to sell its holding in ShinSat.

"If this is a commercial transaction on the basis of both sides being willing parties, then I see no problem at all. This is for Temasek to consider and for the buyers to consider whether the price is right," the Financial Times quoted Yeo as saying.

ShinSat is the satellite flagship of Shin Corp, which was founded by the family of ousted prime minister Thaksin Shinawatra. The family sold its majority stake in Shin Corp last January to a group led by Temasek Holdings.

Problems involving ShinSat have arisen from the political storm that followed the controversial deal, and have focused on Temasek's direct and indirect holdings in the satellite company.

Two weeks ago, the Council for National Security mentioned the likelihood of Thailand taking back the satellite concession for fear of being spied on by foreigners. The Information and Communications Technology Ministry is conducting a public opinion survey on the concession buyback.

Despite its external problems, ShinSat aims to sell 80,000 iPSTAR receiving terminals in the region this year, compared to about 66,000 last year.

ShinSat posted a net loss of Bt46 million for last year, compared with a net profit of Bt1.34 billion in 2005, due to higher expenses and the write-off of its de-orbited satellite, Thaicom 3.

Its revenue from services and sales was Bt6.846 billion, up 22.5 per cent from 2005, but its sales and services costs rose 51.8 per cent from Bt3.9 billion in 2005 to Bt5.92 billion.

Tanadit said ShinSat was close to finalising a deal with a major customer in India for iPSTAR services.

The company's mobile-phone businesses in Laos and Cambodia are also expected to contribute higher revenue, despite having contributed an average 30 per cent of net profit to date.

Both telecom operators in Cambodia and Laos plan to launch 3G wireless broadband services by the middle of the year.

Meanwhile, the Thai government continues to investigate whether the controversial takeover of Shin Corp was achieved by Temasek Holdings through its use of a nominee, and the military junta says its wants the ShinSat satellites back from Temasek because of national security concerns.

Shin owns about 41 per cent in ShinSat. Analysts say that even if Shin were 100 per cent foreign-owned, ShinSat could still not be deemed a foreign firm. Both telecom and foreign business laws cap foreign shareholdings in telecom operators at 49 per cent.

Tanadit admitted that foreign customers had queried ShinSat following the junta's remarks on the need to take back the satellites. However, none has mentioned plans to quit ShinSat's services.

The ICT Ministry is to ask the Cabinet to consider approving a policy banning satellite operators from launching new satellites if they are proven to be 100 per cent foreign-owned. It is also investigating amendments to ShinSat's concession, to make sure they comply with relevant laws.

Tanadit said that ShinSat, which is mainly Thai-owned, would not be affected by the new policy because it has no plans to launch another satellite in the near future.

"The executives never discuss plans to launch a new satellite," he added. "It is discussed at engineering level and, in general, it takes years of feasibility study before a decision is made to build a satellite."

He said ShinSat would seriously consider the construction and launch of Thaicom 6 after it sells all the transponder capacity of Thaicom 5 and iPSTAR. At present, 80 per cent of Thaicom 5 and 10 per cent of iPSTAR are being used.

ShinSat expects iPSTAR's capacity of 40 gigabits per second to be fully used within five years.

ShinSat stock closed at Bt7.60 yesterday, 2 per cent up on Friday's closing price.

Sirivish Toomgum

The Nation