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HONG KONG, Oct 8 (Reuters) - Singtel Optus has hired three banks to make a benchmark-sized offering of 10-year dollar bonds, a source close to the transaction said on Thursday.
I noticed alot of 1 lot sells in the buy/sell queue for Singtel counter.
Market share / market price manipulation going on?
Tariff cuts aimed at new players in India
• Bharti may register low-single digit growth ahead.
• We lowered SingTel’s FY10/11F earnings by 2%/3%.
• SingTel’s TP lowered to S$3.30. Maintain HOLD
Rcom initiated tariff cuts targeted at new entrants. In response to the entry of new players, Rcom cuts its tariffs by up to 50% on long distance and roaming calls, while local call tariffs remain largely same. The lower tariff would hit hard the new players – who do not own long distance lines and do not have pan India presence. Assuming that Bharti is forced to retaliate, its average revenue per minute (ARPM) could decline by c.20% in the next one year, offsetting an estimated 25% subscriber growth and 10% usage (MoU) growth in FY10F. We lower Bharti FY10F/11F earnings by 6%/8% each, and expect Bharti’s earnings to show low-single-digit growth in FY10/11F compared to consensus’ projection of 13%/11%. This lowers our SingTel FY10F/11F earnings by 2% each.
Talks about per second billing in India are in the preliminary stage. While the regulator TRAI has mentioned about making per second billing mandatory for operators, there is no timeframe yet. TRAI may issue a consultation paper seeking the industry's views. However, it is unlikely to garner much support, as it would imply additional capex for setting up IT & billing systems. This could be resisted by both big and small players, specially when tariffs are already declining sharply.
Including high content cost, SingTel’s FY10F/11F earnings lowered by 2%/3% overall. We have assumed S$40m (c.1% of earnings) adverse impact on earnings in FY11F due to high cost of English Premier League (EPL) rights. Overall, we lower our FY10F/11F earnings by 2%/3%. Our SOTP target price is lowered to S$3.30 as we lowered (i) our fair value of Bharti by 10% to Rs 375. (ii) Lowered our Singapore-Optus valuation by 3%.
DBS Vickers
nickyng ( Date: 07-Oct-2009 14:09) Posted:
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TRUNK CALLS
On first glance, Telstra would appear to have enough on its plate - such as working out the best way to separate the company and rifling through submissions to a Senate inquiry made by citizens, fund managers and competitors.
Optus, for example, wryly noted that plenty of analysts had maintained ''buy'' recommendations on Telstra following the Federal Government's announcement of proposed reforms.
And it seems the regulatory pressure on the home front may not have prevented Telstra from pursuing overseas growth options.
India's Financial Express yesterday reported Telstra was among a slew of international bidders for 3G spectrum in that country, which would allow it to enter the wireless broadband market.
This would represent an intriguing strategic move for Telstra. Frustrated by local regulations, it exited its 49 per cent stake in Modi Telstra in 2000.
This is not the first time this year that Telstra has been linked to a possible investment in India. In February, Malaysia's Maxis Communication contacted Telstra to see whether it was interested in buying about 20 to 25 per cent of Indian telecom operator Aircel for up to $US2 billion. Telstra did not bite.
The market might not be pleased if Telstra chose to return to India.
Citi analysts last month argued Telstra should exit all of its overseas investments and said they would strongly advise management against trying to expand its offshore assets in the pursuit of growth.
Meanwhile, some other operators are not finding the going easy in the Indian market.
In response to a query about its recent share price decline, SingTel yesterday said increased competition in the Indian market, which would affect its 30 per cent stake in Bharti Airtel, could be to blame.
I don't reckon so I heard wrongly.
Maybe have to scour around for that piece of broadcast.
frosin ( Date: 08-Oct-2009 09:54) Posted:
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The immediate fallout of RCom’s move is that its new tariff, named ‘Simply Reliance’ , will chop average revenue that a telco generates per minute of mobile connectivity by half. Analysts at Kotak securities and ICICI Securities estimate that RCom revenue for a minute’s call will fall to 35-36 paise from 64 paise.
The target seems to be Bharti Airtel — the nation’s biggest mobile phone operator. Bharti’s cost of generating one wireless call is around 39 paise, nearly 10% higher than RCom’s new per minute realisation, say analyst reports. This may be a pressure point for Bharti . However, it is worse for others.
Maybe this is why not many think Bharti can cope with this price competition? While Kim Eng thinks that there is good news in the quarter just passed to be released, not many are seeing the future prospects.
really? then it depends on whether you trust the news on tv more or what i posted here more. anyway i didn't write those in italics.
I think you missed one word "previously"
Macquire "previously" upgraded Singtel to outperform at 3.53
Anyway Kimeng has an interesting opinion as well. "Buy first, think later."
MUMBAI: KIM ENG Securities has recommended ‘Buy’ on Bharti Airtel and Reliance Communications on declines. The brokerage plans to review its forecasts after the second quarter earnings. “Telecom stocks declined after analysts downgraded stocks on concerns over sustainable ARPU. We maintain our ARPU forecast of a decline of 26% for FY10. Assuming a 31% decline in ARPU this year, Bharti Airtel (BHARTI) earnings would fall less than those of Reliance Communications (RCOM) and Idea Cellular (IDEA). We will review all our forecasts after Q2 earnings are released this month. With further declines, the stocks of Bharti on a PER of 9x FY11F and RCOM at 7x FY11F are very attractive. We recommend BUY on weakness for Bharti and RCOM,” the brokerage said.
stockseeker ( Date: 08-Oct-2009 09:33) Posted:
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That is not what was announced on the news today (8/10/09) on ChannelNewsAsia leh.
It was said that Macquire upgrades Singtel to outperform at 3.53 leh.
frosin ( Date: 08-Oct-2009 09:22) Posted:
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-- SINGAPORE TELECOMMUNICATIONS <STEL.SI>
- Macquarie downgraded its recommendation on Singapore
Telecommunications to "neutral" from "outperform", and cut the
target price to S$3.12 ($2.23) from S$3.53 previously, citing
tougher competition ahead for its Indian affiliate, Bharti Airtel
<BRTI.BO>, as a reason.
- DBS Vickers lowered its target price of SingTel to S$3.30
from S$3.45 previously.
Target price of $3.12. I guess they are more pessimistic than I am about the impact.
With this new target price, it really sets people thinking what is the new trading range.
Typically, a target price is the fair value. when news are good, it trades above that.
When news are neutral, it trades somewhere below that value.
when news are bad, i can't imagine.
I still think $3.04 is a good price for Singtel but things just don't look as cherry as I thought.
my idea is that the stock will hit 3.04 and I want to enter at that price. after which, I will wait for the india 3g license results, if bharti wins, i keep for profit, if not, i will dump it at whatever price.
new competitors AT&T and telstra just intensified that prospects of bharti.
frosin ( Date: 07-Oct-2009 16:31) Posted:
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SingTel's Bharti risk By Andrew Peaple, The Wall Street Journal Friday 14 August 2009 Indian telco's contribution to SingTel's earnings rose 16% in Q1. Singapore Telecommunications' latest results again show how important its Indian associate, Bharti Airtel, has become to the group. Bharti's contribution to SingTel's pretax earnings rose nearly 16% in the first quarter from a year earlier, a major factor in the Singapore company's overall 7.7% rise in net profit.
October 7, 2009 -- SingTel under review at Macquarie after Bharti Airtel downgrade
Singapore Telecommunications’s earnings, valuation and stock recommendation are under review for a downgrade by Andrew Levy, an analyst at Macquarie Research Equities, after Bharti Airtel was cut to “underperform” by the bank. SingTel owns about 30% of Bharti.
Singtel bid for EPL will cost "money", this will be translated to the consumer in Sg. Can the consumers accept such disruption? Some need 2 set tops at home now to watch hk drama and sports.
Singtel's Bharti Airtel, the country's largest wireless service provider, slumped 10% to close at Rs 359.40, taking losses in just two trading sessions to 17%, the steepest two-day fall in almost a year. Reliance Communications tumbled 11% and Idea, the country's fourth-largest mobile operator, fell 8%.The share continue to fall on this third day by another 2%.
Singtel's optus might be in need of credits as it meets bond investors.
What kind of losses have materalised and what are the lost in prospects?
By Sarah McDonald
Oct. 7 (Bloomberg) -- Singapore Telecommunications Ltd.’sOptus Pty unit is meeting with bond investors, it said.
Sydney-based Optus is currently holding the meetings, which are to update investors, spokeswoman Elizabeth Greene said in response to e-mailed questions from Bloomberg News.
She declined to comment on whether the meetings are directly linked to a bond sale.
To contact the reporter on this story: Sarah McDonald in Sydney at smcdonald23@bloomberg.net. Last Updated: October 6, 2009 21:08 EDT
DBS Vickers cuts SingTel (Z74.SG) target price to S$3.30 from S$3.45 on lowered assumptions for Indian associate Bharti (532454.BY), Australian business Optus in sum-of-the-parts valuation; maintains Hold rating. Broker also trims FY10, FY11 earnings forecasts by 2%, 3%, respectively, to factor in rising price competition in Indian telco market, earnings hit for SingTel from high content costs for English Premier League rights. Says tariff cuts by rivals in India could force Bharti's average revenue per minute down. Expects Bharti's earnings to show low-single-digit growth in FY10 and FY11 vs consensus expectations for 11%-13% growth. Shares down 1.6% at S$3.07; STI +1.0%. (KIG)
Contact us in Singapore. 65 64154 140;
MarketTalk@dowjones.com
erictkw ( Date: 07-Oct-2009 11:22) Posted:
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DBS vicker obviously have ownership/interests in singtel share.
Anyway I dun understand why the share is not falling. it is still $3+. anyway, I guess we will all learn how big an impact once the results is announced and likely to see it reflected in their outlook too.
Bharti shares fell 10.2 percent to their lowest close since April 23. The fall, the biggest in a year, wiped more than $3 billion off Bharti's market capitalisation and saw the company drop one notch to India's fifth most-valuable listed firm.
from reuter, $3 billion, 30% is singtel's. Currency not specified.
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