Reach Ten to gain from Budget 2026’s Jendela push

KUCHING (Dec 1): Bursa Malaysia Main Board-listed Reach Ten Holdings Bhd (Reach Ten) is well-positioned to capitalise on Sarawak’s secular growth theme.

The research team at RHB Investment Bank Bhd (RHB Research) expect the company to post a decent financial year 2026 (FY26) to FY28 forecast core earnings cumulative annual growth rate (CAGR) of 14 per cent, underpinned by National Digital Network (Jendela) Phase 2 awards, the expansion of its fibre network into new cities, and Sarawak’s digitalisation initiatives.

“Reach Ten is a key proxy to Sarawak’s digitalisation roadmap, given its track record in Deploying satellite broadband wireless access (BWA) in the state under Jendela Phase 1,” commented analysts with RHB Investment Bank Bhd (RHB Research) in its analysis recently.

“The group also has many state-backed digitalisation projects including the Sarawak Linking Urban, Rural, and Nation (Saluran) and SMART600 initiatives.”

The Government had, during the Budget 2026 announcement, revealed that Jendela Phase 2 involves deploying 2,700 more sites to further improve broadband coverage and connectivity.

RHB Research sees East Malaysia capturing the lion’s share of site allocations, as broadband connectivity in Sabah and Sarawak still lag that of West Malaysia.

Starlink complements the very small aperture terminal (VSAT) satellite broadband service with new industry use cases. Reach Ten was appointed as a reseller of Starlink’s hardware and broadband services by SpaceX in Feb 2025.

To date, it has successfully deployed the low-orbit, high-speed satellite service across 300 sites in Sabah and Sarawak. Starlink enhances Reach Ten’s existing VSAT portfolio — which is deployed across 1,200 sites — enabling expansion into new sectors such as maritime, offshore oil & gas, and Internet of Things (IoT).

Based on industry reports, Sarawak requires approximately 7,000 towers by 2030 as part of its digitalisation roadmap. The state had 4,500 installed towers as at end-2023, which suggests that there is significant headroom for infrastructure providers, including Reach Ten, to address the connectivity needs by constructing more base transceiver stations (BTS).

“We note that Sarawak-based infrastructure providers are typically favoured to undertake major digitalisation projects, having been pre-qualified by the Sarawak Multimedia Authority (SMA) and holding the UPKJ certification, which is only granted to local companies,” the research house highlighted.

Utilising RM25 million of its IPO proceeds, Reach Ten plans to construct 100 4G/5G towers over the next three years. The towers will be staggered across Miri, Sibu and Bintulu – densely populated cities witnessing explosive demand for broadband/data connectivity.

“The population of the three cities and Kuching combined make up more than half of Sarawak’s population, which provides further validation of the company’s investment plans. Reach Ten’s existing fibre network, which spans more than 600km, runs through Kuching and Samarahan.

“Overall, we see the deployment of new towers driving improved monetisation opportunities for the group in the longer term via recurring site rentals. Additionally, we do not rule out Reach Ten deploying build-to suit sites for 5G network access providers, Digital Nasional (DNB) and U Mobile in East Malaysia, with opportunities for co-location.”