StarHub: HSBC sees unlikely short term disruption from Netflix. StarHub has been proactively recontracting subsribers to two-year plans, making initial penetration difficult for Netflix until the contracts lapse again. Moreover, people have already been viewing Netflix via VPN, so in a way, the impact of Netflix has been filtering through already.
Meanwhile, in anticipation of the fourth-operator risk, StarHub’s management had earlier said in 2H15 earnings call that StarHub can adjust existing plans, as necessary, for instance, to tweak towards more data heavy plans to stay competitive.
For now, HSBC thinks M1 is most vulnerable, given its high exposure to mobile revenue, while Singtel, with its business most diversified is least vulnerable.
HSBC’s has a Hold rating for StarHub with a TP of $3.78
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