SMRT – OCBC
HIGHER COSTS TO COME AS EXPECTED
• Increased train runs to reduce wait time
• Electricity consumption will go up
• But accounted for in FY12F estimates
Train frequency to increase as expected.
SMRT announced on Sunday that it will increase train frequencies on the NSEWL (North-South East-West Lines) to lower the average interval waiting times during peak commuter travelling periods. Previously, the interval between trains had been between 3.75-5 minutes following the operational loss of 13 damaged trains but will now return to an interval of between 2.14-3 minutes following the subsequent repairs made to 12 of the trains. However, speed restrictions for certain parts of the NSEWL tracks will remain in place – as a precautionary measure pending the conclusion of further investigation – and will add about two minutes to end-to-end travel time.
COI appointed; internal investigation ongoing.
The transport minister has appointed a three-person Committee of Inquiry (COI) to look into last month’s service disruptions. The COI will gather information from SMRT and the Land Transport Authority (LTA) as well as solicit evidence from the public. Meanwhile, internally, SMRT has commenced its own investigation, which is expected to take at least two months to complete.
Higher costs factored in; earnings est. unchanged.
As we have previously lowered our FY12F operating profits to account for the possibility of increased train runs and higher 3Q repair and maintenance costs, we are leaving our earnings estimates unchanged pending the release of SMRT’s 3Q12 results.
Dividend payout uninhibited – maintain BUY.
Even with the expected increase in repair and maintenance expenses as well as electricity consumption costs resulting from a greater number of train runs, we maintain our assertion that SMRT’s dividend payout ability remains intact at least for the year (FY12F dividend yield: 4.4%). Therefore, we leave our DDM-derived fair value of S$2.04 unchanged and maintain our BUY rating on SMRT.
STEng – Lim and Tan
ST ENGINEERING
S$2.68-STE.SI
• STE was, on Wed Dec 28th back to the $2.66 low first reached in mid August, itself the lowest since 2009.
• The stock had bounced strongly to $2.86 in early December after testing $2.67 on Nov 30.
• The significance of the technical support at $2.60-2.70 area lies in the fact that it was the top of the recovery range that prevailed through Apr – Sept’09.
• The uptrend line connecting the low points of Oct’08 ($1.99) and Feb’09 ($2.06) presently points to $2.40-2.50 as the next support should $2.66 give way.
• Assuming an unchanged dividend of 14.55 cents for 2011 as for 2010 (3 cents interim, 4 cents final and 7.55 cents special), yield at current price would be 5.5% and 5.8-6.1% if the stock drops to $2.40-2.50.
• Earnings for the first 9 months of 2011 are 8% ahead of the same period last year.
• This is not bad for a defensive stock like ST Engineering, whose biggest division (ST Aerospace) counts on the Singapore Defense as key customer.
• Buy.
December 2011
STI = 2646.35 (-26.43)
|
Stock |
Period |
EPS cts |
DPS cts |
Mkt |
Yield |
PE |
Div Breakdown |
|
SPH |
FY11 (Aug) |
24 |
24 |
$3.690 |
6.504% |
15.38 |
Interim 7ct ; Final 9ct + 8ct (Special) |
|
SingPost |
FY11 (Mar) |
8.369 |
6.25 |
$0.935 |
6.684% |
11.17 |
Q1, Q2, Q3 1.25ct ; Q4 2.5ct |
|
STI ETF |
Jun-11 |
— |
4.5 |
$2.740 |
3.285% |
— |
Jun11 4.5ct ; Dec10 3.5ct |
|
SATS |
FY11 (Mar) |
17.4 |
17 |
$2.150 |
7.907% |
12.36 |
Final 6ct + Special 6ct ; Interim 5ct |
|
ST Engg |
FY10 (Dec) |
16.21 |
14.55 |
$2.690 |
5.409% |
16.59 |
Final 4ct + 7.55ct (Special) ; Interim 3ct |
Transport
|
Stock |
Period |
EPS cts |
DPS cts |
Mkt |
Yield |
PE |
Div Breakdown |
|
SBSTransit |
FY10 (Dec) |
17.63 |
8.80 |
$1.720 |
5.116% |
9.76 |
Interim 4.5ct ; Final 4.3ct |
|
ComfortDelGro |
FY10 (Dec) |
10.95 |
5.50 |
$1.415 |
3.887% |
12.92 |
Interim 2.7ct ; Final 2.8ct |
|
SMRT |
FY11 (Mar) |
10.6 |
8.5 |
$1.770 |
4.802% |
16.70 |
Interim 1.75ct ; Final 6.75ct |
TELCO
|
Stock |
Period |
EPS cts |
DPS cts |
Mkt |
Yield |
PE |
Div Breakdown |
|
SingTel |
FY11 (Mar) |
24.02 |
25.8 |
$3.090 |
8.350% |
12.86 |
Interim 6.8ct ; Final 9ct + Special 10ct |
|
M1 |
FY10 (Dec) |
17.5 |
17.5 |
$2.500 |
7.000% |
14.29 |
Interim 6.3ct ; Final 7.7ct + Special 3.5ct |
|
StarHub |
FY10 (Dec) |
15.34 |
20 |
$2.910 |
6.873% |
18.97 |
Q1 5ct ; Q2 5ct ; Q3 5ct ; Q4 5ct |
Funds / Infrastructure
|
Stock |
Period |
DPS cts |
Mkt |
Yield |
NAV |
Div Breakdown |
|
SPAus |
1H – Sep11 |
A4.0 (Gross) |
$1.240 |
8.506% |
A$0.89 |
2H11 A4.0ct ; 1H11 A4.0ct |
|
MIIF |
1H – Jun11 |
2.75 |
$0.530 |
10.377% |
$0.81 |
1H11 2.75ct ; 2H10 1.5ct |
* SPAus DPU in A$. Yield is Calculated Using Latest Exchange Rate (1.3184) fm Yahoo
NOTES :
- Mkt Price is as on 30-Dec-11
- SATSvcs : Q212 (Sep11) – Interim 5ct
- SingTel : 1H12 (Sep11) – Interim 6.8ct
- StarHub : Q311 (Sep) – 5ct ; Q211 (Jun) – 5ct ; Q111 (Mar) – 5ct
- SMRT : Q212 (Sep11) – Interim 1.75ct
- SingPost : Q212 (Sep11) – 1.25ct ; Q112 (Jun11) – 1.25ct
- SPH : 2H11 (Aug) – 9ct (Final) + 8ct (Special) ; 1H11 (Feb) – 7ct
- ComfortDelgro : Q211 (Jun) – 2.7ct
- SBSTransit : Q211 (Jun) – 3.1ct
- MIIF : 1H11 (Jun) – 2.75ct ; 2H10 (Dec) – 1.5ct
- ST Engg : 1H11 (Jun) – 3ct
- M1 : 1H11 (Jun) – Interim 6.6ct
- SPAus : 2H11 (Mar11) – A4ct (before tax) / A3.7721ct (after tax) ; 1H11 (Sep10) – A4ct (before tax) / A3.7772ct (after tax)
- StarHub : FY11 Div Guidance – 5ct/Q
December 2011
STI = 2646.35 (-26.43)
|
Stock |
Period |
EPS cts |
DPS cts |
Mkt |
Yield |
PE |
Div Breakdown |
|
SPH |
FY11 (Aug) |
24 |
24 |
$3.690 |
6.504% |
15.38 |
Interim 7ct ; Final 9ct + 8ct (Special) |
|
SingPost |
FY11 (Mar) |
8.369 |
6.25 |
$0.935 |
6.684% |
11.17 |
Q1, Q2, Q3 1.25ct ; Q4 2.5ct |
|
STI ETF |
Jun-11 |
— |
4.5 |
$2.740 |
3.285% |
— |
Jun11 4.5ct ; Dec10 3.5ct |
|
SATS |
FY11 (Mar) |
17.4 |
17 |
$2.150 |
7.907% |
12.36 |
Final 6ct + Special 6ct ; Interim 5ct |
|
ST Engg |
FY10 (Dec) |
16.21 |
14.55 |
$2.690 |
5.409% |
16.59 |
Final 4ct + 7.55ct (Special) ; Interim 3ct |
Transport
|
Stock |
Period |
EPS cts |
DPS cts |
Mkt |
Yield |
PE |
Div Breakdown |
|
SBSTransit |
FY10 (Dec) |
17.63 |
8.80 |
$1.720 |
5.116% |
9.76 |
Interim 4.5ct ; Final 4.3ct |
|
ComfortDelGro |
FY10 (Dec) |
10.95 |
5.50 |
$1.415 |
3.887% |
12.92 |
Interim 2.7ct ; Final 2.8ct |
|
SMRT |
FY11 (Mar) |
10.6 |
8.5 |
$1.770 |
4.802% |
16.70 |
Interim 1.75ct ; Final 6.75ct |
TELCO
|
Stock |
Period |
EPS cts |
DPS cts |
Mkt |
Yield |
PE |
Div Breakdown |
|
SingTel |
FY11 (Mar) |
24.02 |
25.8 |
$3.090 |
8.350% |
12.86 |
Interim 6.8ct ; Final 9ct + Special 10ct |
|
M1 |
FY10 (Dec) |
17.5 |
17.5 |
$2.500 |
7.000% |
14.29 |
Interim 6.3ct ; Final 7.7ct + Special 3.5ct |
|
StarHub |
FY10 (Dec) |
15.34 |
20 |
$2.910 |
6.873% |
18.97 |
Q1 5ct ; Q2 5ct ; Q3 5ct ; Q4 5ct |
Funds / Infrastructure
|
Stock |
Period |
DPS cts |
Mkt |
Yield |
NAV |
Div Breakdown |
|
SPAus |
1H – Sep11 |
A4.0 (Gross) |
$1.240 |
8.506% |
A$0.89 |
2H11 A4.0ct ; 1H11 A4.0ct |
|
MIIF |
1H – Jun11 |
2.75 |
$0.530 |
10.377% |
$0.81 |
1H11 2.75ct ; 2H10 1.5ct |
* SPAus DPU in A$. Yield is Calculated Using Latest Exchange Rate (1.3184) fm Yahoo
NOTES :
- Mkt Price is as on 30-Dec-11
- SATSvcs : Q212 (Sep11) – Interim 5ct
- SingTel : 1H12 (Sep11) – Interim 6.8ct
- StarHub : Q311 (Sep) – 5ct ; Q211 (Jun) – 5ct ; Q111 (Mar) – 5ct
- SMRT : Q212 (Sep11) – Interim 1.75ct
- SingPost : Q212 (Sep11) – 1.25ct ; Q112 (Jun11) – 1.25ct
- SPH : 2H11 (Aug) – 9ct (Final) + 8ct (Special) ; 1H11 (Feb) – 7ct
- ComfortDelgro : Q211 (Jun) – 2.7ct
- SBSTransit : Q211 (Jun) – 3.1ct
- MIIF : 1H11 (Jun) – 2.75ct ; 2H10 (Dec) – 1.5ct
- ST Engg : 1H11 (Jun) – 3ct
- M1 : 1H11 (Jun) – Interim 6.6ct
- SPAus : 2H11 (Mar11) – A4ct (before tax) / A3.7721ct (after tax) ; 1H11 (Sep10) – A4ct (before tax) / A3.7772ct (after tax)
- StarHub : FY11 Div Guidance – 5ct/Q
Telecom – BT
Buffet-style 3G pricing may go off the table
StarHub, SingTel may revise charges to deter hefty usage
(SINGAPORE) The telcos' crusade against virtually unlimited mobile data usage might soon be upon 3G shores. StarHub and SingTel are taking a good look at revising their 3G price plans, the two telcos told BT yesterday.
StarHub said that it may 'review current (3G) pricing plans and consider introducing usage-based data pricing', in response to BT's queries.
This, it said, was 'to ensure optimal network quality for our customers'. Currently, StarHub has three mobile broadband modem plans that offer unlimited data allowances. It also caps the local data usage bill at $30 a month for its mobile phone subscribers.
When it launches its own Long Term Evolution (LTE) – or 4G – network next year, it will not offer an unlimited data option, it said.
SingTel will be reviewing its 3G price plans, which include its mobile broadband plans that carry a data usage allowance of 50 gigabytes (GB).
This comes two days after it moved to start weaning high data-usage consumers off generous 3G data caps with a new 4G pricing structure.
By 2013, when 95 per cent of its users have access to the 4G network, new 4G data subscribers will have to make do with a 10GB cap on data, paying for the additional data that they use.
SingTel also revealed that 11 per cent of its 3G subscribers on dongles and tablets account for a staggering 60 per cent of data traffic.
'It's unsustainable and when you grow it, it becomes a challenge,' said Yuen Kuan Moon, SingTel executive vice-president, digital consumer group.
StarHub and M1 did not reveal their own data figures, but industry observers believe the usage patterns are similar to SingTel's.
M1 is staying tight- lipped on both its existing 3G price plans and approach to pricing LTE usage next year.
'We regularly review all our service offerings to ensure they are compelling and competitive,' its spokesman told BT.
It has the same narrow view of unlimited data usage, however. 'Mobile network resources are limited, and the experience of the majority of customers should not be adversely affected by a minority of customers who regularly consume large amounts of data.'
While SingTel's new 4G service currently applies only to dongle modems, StarHub's review of its 3G price plan could apply across several devices – dongles, smartphones and tablets.
Analysts have pointed out for a while that the real battle for average revenue per user will be fought not over the dongle platform, but on smartphones and tablets, where increasing data usage is cannibalising lucrative voice calls and SMSes.