CLIENT CALL "ALL IN" ON BRAZILIAN TELCOS

NEW STREET RESEARCH analyst SOOMIT DATTA will host an Investor Call to run through our recent upgrade of TIM (BUY) and pull together more broadly why, after a number of years of lacklustre performance, we think it is time to be very constructive on the Brazilian telcos sector. We are already Buyers of VIVO and AMERICA MOVIL (with 20% Brazil exposure).

We think factors are falling into place to make Brazil one of the most rewarding regions to invest in Global Communications.
• 5, to 4 to 3 wireless consolidation completed
• Price rises in Post-paid wireless, with the gap between front book and back book closing
• Price rises in Pre-pay being tested; we expect to come through from H2
• Legacy fixed pressure diminishing plus support from Enterprise (Vivo, AMX)
• Falling capex and ramping FCF
• Healthy dividends (6-7% yields) given strong balance sheets
• End of the Brazil rates cycle: 13.75% SELIC to fall H2/early 2024. Inflation down to 4-5% (from double digit). 250 bps fall in 10-year sovereign.