Omantel SWOT and PESTLE Analysis

Strengths

1. Strong Financial Performance: Omantel posted a strong financial performance in FY 15 with a top line growth of 6.9%, which was also the highest revenue in last four years. The company has also decided to impair its investment in Pakistan based Worldcall Telecom (WTL) which has been a consistent underperformer since 2008 and affected Omantel’s overall results and this move will clean its accounts. Omantel is rated at ‘BBB’ and ‘A3’ by S&P and Moody’s respectively

2. Leading Omani Telco: Omantel is the leading telecom player in Oman with an estimated market share of almost 60% in mobile network in both subscribers and revenue. Its share in fixed lines is estimated to be 78% with revenues in the segment at 82%. Its network reach is across the Sultanate and is the leading integrated telecom service provider. It is also Oman’s Most Valuable Brand according to a study by Brand Finance.

3. Government Support: The government of Oman holds 51% stake in the company, thus it enjoys government support and overall stability. With the government of Oman being a major stakeholder they have a lot of resources available to make sure that they get the best and the latest infrastructure at their disposal. Also, as the government is the major shareholder, many investors have a sense of comfort and do not mind investing in the company.

4. Strategic Investments across the Telecom Sector: Omantel’s holds 60% stake in its subsidiary, Oman Data Park which offers services such as managed hosting, cloud hosting, managed services and security. The investment in Oman Data Park extends its reach across the other areas and enables it to build a platform to offer comprehensive services to its clients. Omantel also holds a ~41% stake in Oman Fibre Optic Co SAOG (OFOC) which is a manufacturer of high quality optic fibre in Oman.

Political

1. Enjoys strong government support: Omantel which is the flagship telecom company of the Sultanate of Oman, also has the Oman's government as the majority shareholder with 51% stake. Absolute monarchy in Oman means that the Sultan has final say in all decisions regarding industry and areas of investments as well as regulations which speeds up business decision making and benefits Omantel.