StarHub – Phillip
Launch of NGNBN
• StarHub held a media conference on its plans and solutions for NGNBN
• Raise our revenue and net profit estimates
• Maintain Hold and raise fair value from S$2.16 to S$2.41
StarHub held a media conference on 2 September 2010 to launch its plans and solutions for the Next Generation National Broadband Network (NGNBN). In particular, StarHub highlighted its home and business solutions for the fibre optic network. With NGNBN, it can reach out to all businesses and homes in Singapore. This would place it on an equal footing to compete with SingTel, which is the current leader in the broadband market. It also demonstrated to analysts on the use of its solutions for 3D gaming, cable television programs and video conferences.
Our views on StarHub’s plans
We are impressed by StarHub’s plans on NGNBN. It has also become the first telecommunications company to provide more details of its price plans for NGNBN, which are named as MaxInfinity. In fact, it has four access plans that are priced from S$68.27 to S$395.90. No details have been provided on the operating margins, but we believe that StarHub will benefit from the new plans.
Revised revenue and net profit estimates
We have raised StarHub’s broadband revenue estimates by 5.6%, 33.2% and 42.5% to S$281.5m, S$370.8m and S$414.1m in FY2010E, FY2011E and FY2012E respectively. This is because we expect StarHub to register a net gain of 60,000, 30,000 and 20,000 broadband subscribers in FY2010E, FY2011E and FY2012E respectively. Moreover, net profit is projected to increase by 5.1%, 32.3% and 41.9% to S$216.5m, S$267.1m and S$293.2m in FY2010E, FY2011E and FY2012E respectively.