Advanced Info Service (ADVANC)

AIS’s current credit level is very strong as a Thai domestic issuer, and as an international bond credit it is an investment-grade telecom credit consistent with S&P BBB+. However, international bond investors should not treat it as having the same cushion as domestic AAA(tha), and need to consider Thailand single-country concentration, offshore bond covenants, swap details, international market liquidity, and currency and sovereign constraints. The current credit quality is supported by leading positions in mobile and fixed broadband, high EBITDA, low leverage including leases and spectrum, strong interest coverage, and domestic and international funding access. The direction of credit quality is stable to flat, and the probability of rapid credit deterioration currently appears low. However, if competition, regulation, spectrum, dividends, and data-center investment overlap, the effects are likely to appear first in effective leverage and FCF.

The core support for AIS’s credit quality is its domestic telecom business base and cash flow. As of 1Q2026, AIS had 46.9mn mobile subscribers, 5.3mn FBB subscribers, and 18.5mn 5G subscribers, and mobile and FBB ARPU improved year on year. EBITDA margin was 55.3%, service EBITDA margin was 68.5%, and operating CF was Bt30,744mn for three months. This scale and profitability give AIS high capacity to absorb normal capital expenditure, spectrum payments, and short-term debt.

However, it is insufficient to view AIS simply as a “low-leverage telecom company.” Net debt / EBITDA excluding leases and spectrum is low at 0.5x, but to assess the effective fixed burdens of a telecom company, the ratio including lease liabilities and spectrum license payable should be emphasized. This ratio was also sufficiently low at 1.5x in 1Q2026, but if CAPEX, dividends, spectrum, GSA, and virtual banking overlap, this effective-burden ratio may rise before ordinary net debt / EBITDA does.