Telco: OCBC downgrades Singapore telecom sector to Neutral from Overweight. Note that yields still good & mobile segment expected to perform reasonably well in 2011, however highlight that ARPUs have not been rising even as more are taking up smartphone packages, while acquisition costs are rising….
As such, it looks unlikely there will be a significant recovery in EBITDA margins; but do not expect any debilitating price wars. Cite that NBN is a story for late 2011 and even 2012. However, note that there are probably very little positive catalysts going for them in 2011. Has Buy call for all the Telco’s, with TP of $3.02 for StarHub, $3.59 for Singtel and $2.70 for M1.
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