SGX Market Strategist, Equity & Fixed Income, Singapore Exchange Ltd (SGX)

Geoff Howie

SGX Market Strategist, Equity & Fixed Income

Asia’s leading multi-asset exchange

Singapore Exchange Ltd (SGX)

Singapore Exchange is Asia’s leading and trusted market infrastructure, facilitating the exchange of capital and ideas to create value for people, businesses and economies. As a multi-asset exchange operating equity, fixed income and derivatives markets to the highest regulatory standards, SGX is a vertically integrated business that provides listing, trading, clearing, settlement, depository and data services.

With about 40% of listed companies and over 80% of listed bonds originating outside of Singapore as well as established linkages across the region and in Europe, SGX is Asia’s most international and connected exchange. Offering a full suite of derivatives products across Asian equity indices, commodities and currencies, SGX is the world’s most liquid international market for the benchmark equity indices of China, India, Japan and ASEAN.

As Asia’s pioneering central counterparty, SGX is globally recognised for its risk management and clearing capabilities, and was one of the first globally to adopt the Principles for Financial Market Infrastructure.

Headquartered in AAA-rated Singapore, SGX has over 800 employees including offices in Beijing, Chicago, Hong Kong, London, New York, Mumbai, San Francisco, Shanghai and Tokyo.

Equity Bottom-Up

In the month of November 2016, there were a total of 24,007,000 shares repurchased by 30 companies, with a total consideration of S$40.0 million. This compares with S$26 million in October 2016 and S$45 million in November 2015.The five stocks with the largest buyback consideration values in November 2016 were StarHub, UOL Group, SIA Engineering Company, Singapore Exchange and Hi-P International.Buybacks in November 2016 have taken the total share buyback consideration for the 2016 YTD to S$818…

In the month of November 2016, there were a total of 24,007,000 shares repurchased by 30 companies, with a total consideration of S$40.0 million. This compares with S$26 million in October 2016 and S$45 million in November 2015.The five stocks with the largest buyback consideration values in November 2016 were StarHub, UOL Group, SIA Engineering Company, Singapore Exchange and Hi-P International.Buybacks in November 2016 have taken the total share buyback consideration for the 2016 YTD to S$818…

30 Companies Bought Back Own Shares in November

Differentiated global TMT & Internet Research

New Street Research Insights

New Street Research

Research is provided by our team of experienced analysts. Our work is idea driven, based on independence of thought, sector expertise, and firmly focused on fundamentals and valuation of telecoms and internet names globally. New Street is headquartered in London with offices in New York, Singapore and Australia. 

New Street Research is an independent, partner-owned, research firm specialising in equity and debt research. Our equity research embraces the following sectors:

Pan European Telecom Services and Cable
US Telecoms, Cable, Satellite and Towers
Global Emerging Market Telecoms
Japan Telecoms
Asian Internet
Pan European Healthcare
US Healthcare
Japanese Healthcare

We also provide debt research on:
Pan European Telecom Services and Cable

Singtel (Singapore Telecommunications) / Equity Bottom-Up

After some delay, the Singapore regulator (IMDA) announced yesterday there were two qualified candidates for the 4th cellular license: MyRepublic and <a href="https://www.smartkarma.com/entities/323" target="_blank" data-smartkarma-citation="entities:323:1">TPG (TPM AU)</a> . The third bidder AirYotta did not qualify. We expect the auction (the New Entrant Spectrum Auction = NESA) to take place before the end of 2016. It is now almost certain that there will be a fourth entrant in Singapore but having two bidders is not the worst outcome for the incumbent operators. At least there is some bid tension and…

After some delay, the Singapore regulator (IMDA) announced yesterday there were two qualified candidates for the 4th cellular license: MyRepublic and TPG (TPM AU) . The third bidder AirYotta did not qualify. We expect the auction (the New Entrant Spectrum Auction = NESA) to take place before the end of 2016. It is now almost certain that there will be a fourth entrant in Singapore but having two bidders is not the worst outcome for the incumbent operators. At least there is some bid tension and…

Singapore Telcos: And Then There Were Two (Bidders for the 4th License).

Leading Independent Investment Research, Morningstar, Inc.

Morningstar

Leading Independent Investment Research

Morningstar, Inc.

Morningstar, Inc. is a leading provider of independent investment research in North America, Europe, Australia, and Asia. We offer an extensive line of products and services for individual investors, financial advisors, asset managers, and retirement plan providers and sponsors. 

Morningstar provides data on more than 500,000 investment offerings, including stocks, mutual funds, and similar vehicles, along with real-time global market data on more than 16 million equities, indexes, futures, options, commodities, and precious metals, in addition to foreign exchange and Treasury markets. Morningstar also offers investment management services through its investment advisory subsidiaries, with more than $180 billion in assets under advisement or management as of June 30, 2015. We have operations in 27 countries.

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StarHub’s third-quarter 2016 result was slightly below our expectations with services revenue declining 2.2% and EBITDA down 10.1% on the previous corresponding period.  Management retained its 2016 guidance of service revenue to be about 2015 levels at an EBITDA margin of around 32% of service revenue. While the full-year guidance is in line with our existing forecasts, at the EBITDA level the mix is not as good as government grant revenue was higher than expected with mobile revenue lower. We therefore lower our forecasts for 2017 onwards by around 5% with our fair value estimate lowered to SGD 3.10 from SGD 3.20 per share previously.Our narrow moat rating on StarHub based on cost advantage and efficient scale remains with the company continuing to earn returns well above its cost of capital but earnings and cash flow growth are proving difficult. StarHub is facing the gradual erosion of its pay-TV franchise and the possibility of a new entrant into the mobile market. Our fair value would see the company trade on a P/ E ratio of 15.6 times with the price supported by a 6.3% dividend yield.Analyst: Dan Baker

StarHub’s third-quarter 2016 result was slightly below our expectations with services revenue declining 2.2% and EBITDA down 10.1% on the previous corresponding period.  Management retained its 2016 guidance of service revenue to be about 2015 levels at an EBITDA margin of around 32% of service revenue. While the full-year guidance is in line with our existing forecasts, at the EBITDA level the mix is not as good as government grant revenue was higher than expected with mobile revenue lower. We therefore lower our forecasts for 2017 onwards by around 5% with our fair value estimate lowered to SGD 3.10 from SGD 3.20 per share previously.Our narrow moat rating on StarHub based on cost advantage and efficient scale remains with the company continuing to earn returns well above its cost of capital but earnings and cash flow growth are proving difficult. StarHub is facing the gradual erosion of its pay-TV franchise and the possibility of a new entrant into the mobile market. Our fair value would see the company trade on a P/ E ratio of 15.6 times with the price supported by a 6.3% dividend yield.Analyst: Dan Baker

Narrow Moat-Rated StarHub Third Quarter 2016 Slightly Below Expectations; FVE Down

Equity, Bottom-up Analyst, Investics Research

Sameer Taneja

Equity, Bottom-up Analyst

Kelusa Asia Focus Funds

Starhub reported a dismal Q3 2016 result, but it's not their worst result in the 10 quarters in absolute terms of profitability.  Here is a brief snapshot of the result.  <figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/015/755/original/STH2.png?1478082529" class="editor-image img-responsive" data-smartkarma-image-id="15755"></figure>source : The company Note that :1. Other Income is substantially lower due to a one-off gain in 3Q 2015 of 15 mn SGD relating gain on deconsolidation of a subsidiary. Also there was lower other income on government grants by around 5 mn SGD.2. EBITDA on services lower by 20 mn SGD , reasons I will highlight further.<div class="content-highlight">REVENUE</div>…

Starhub reported a dismal Q3 2016 result, but it's not their worst result in the 10 quarters in absolute terms of profitability.  Here is a brief snapshot of the result.  source : The company Note that :1. Other Income is substantially lower due to a one-off gain in 3Q 2015 of 15 mn SGD relating gain on deconsolidation of a subsidiary. Also there was lower other income on government grants by around 5 mn SGD.2. EBITDA on services lower by 20 mn SGD , reasons I will highlight further.REVENUE…

Starhub Q3 2016: Disappointing but Could Get a Whole Lot Worse

The M1 3Q 2016 results demonstrate how headwinds for the telecom industry in Singapore are getting stronger. For those of you who have not looked at M1's Q3 2016, I've just compiled a brief snapshot with the summary of the earnings relative to quarters of past years<div class="content-highlight">M1 Quarterly Results Snapshot</div><figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/014/989/original/M17.png?1476855740" class="editor-image img-responsive" data-smartkarma-image-id="14989"></figure>Source : Company<div class="content-highlight">Weak ARPU'S</div>ARPU's for postpaid subscribers declined -7.7% YoY from 61.5 SGD/month to 56.5 SGD/month. The weaker ARPU's for M1 were driven by  1)  Lower roaming rates 2) Decline in customers…

The M1 3Q 2016 results demonstrate how headwinds for the telecom industry in Singapore are getting stronger. For those of you who have not looked at M1's Q3 2016, I've just compiled a brief snapshot with the summary of the earnings relative to quarters of past yearsM1 Quarterly Results SnapshotSource : CompanyWeak ARPU'SARPU's for postpaid subscribers declined -7.7% YoY from 61.5 SGD/month to 56.5 SGD/month. The weaker ARPU's for M1 were driven by  1)  Lower roaming rates 2) Decline in customers…

M1 3Q2016 : Depressing ARPU Trend To Spillover Into Comps ?

Singapore

StarHub Ltd. is a fully-integrated info-communication company offering a full range of information, communications, and entertainment services for both consumer and corporate markets in Singapore. The Company provides mobile network and multi-channel cable TV services, including high definition and on-demand services, as well as high-speed residential broadband services.

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StarHub Ltd (STH SP)

30 Companies Bought Back Own Shares in November

In the month of November 2016, there were a total of 24,007,000 shares repurchased by 30 companies, with a total consideration of S$40.0 million....

Singapore Exchange Ltd (SGX)

Singapore Telcos: And Then There Were Two (Bidders for the 4th License).

After some delay, the Singapore regulator (IMDA) announced yesterday there were two qualified candidates for the 4th cellular license: MyRepublic...

New Street Research

Narrow Moat-Rated StarHub Third Quarter 2016 Slightly Below Expectations; FVE Down

StarHub’s third-quarter 2016 result was slightly below our expectations with services revenue declining 2.2% and EBITDA down 10.1% on the previous...

Morningstar, Inc.

Starhub Q3 2016: Disappointing but Could Get a Whole Lot Worse

Starhub reported a dismal Q3 2016 result, but it's not their worst result in the 10 quarters in absolute terms of profitability. Here is a brief...

Sameer Taneja

M1 3Q2016 : Depressing ARPU Trend To Spillover Into Comps ?

The M1 3Q 2016 results demonstrate how headwinds for the telecom industry in Singapore are getting stronger. For those of you who have not looked...

Sameer Taneja

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