M1 (formerly: MobileOne)

M1 released its 1Q17 results:

http://infopub.sgx.com/FileOpen/1Q17SGXA...eID=448571

The story of a competitive telco market continues with M1's falling telecoms revenue, higher costs and expenses, resulting in lower profit and profit margin. Recent capex on the network spectrum also gobled up lots of cash, something that is not uncommon for telcos as they are expected to continuously improve product offering.

Can M1 maintain, or even increase, its profitability when TPG enters the market operationally?

(17-04-2017, 05:56 PM)karlmarx Wrote: M1 released its 1Q17 results:

http://infopub.sgx.com/FileOpen/1Q17SGXA...eID=448571

The story of a competitive telco market continues with M1's falling telecoms revenue, higher costs and expenses, resulting in lower profit and profit margin. Recent capex on the network spectrum also gobled up lots of cash, something that is not uncommon for telcos as they are expected to continuously improve product offering.

Can M1 maintain, or even increase, its profitability when TPG enters the market operationally?

I didnt really look deeper into the results. But comparing Q4 2016 and 1Q 2017, I think the results are pretty much the same.

From the pace of local telco deteriorating in their profits, by the time TPG is ready, will probably bleed from day one.

SINGAPORE — Top shareholders in Singapore telecoms company M1 Ltd have approached potential buyers China Mobile and global private equity firms, among others, to sell their combined majority stake in the firm, sources familiar with the matter said.
...

http://m.todayonline.com/business/china-...m1-sources

(21-04-2017, 10:27 PM)funman168 Wrote: SINGAPORE — Top shareholders in Singapore telecoms company M1 Ltd have approached potential buyers China Mobile and global private equity firms, among others, to sell their combined majority stake in the firm, sources familiar with the matter said.
...

http://m.todayonline.com/business/china-...m1-sources

It's about time to take 'value' 

Foreign investors are not that stupid. They will evaluate the cashflow returns of M1 under the scenario where telecommunications now operate in an environment where there are 2 Temasek Linked Telecos vs 2 Foreign owned telecos.

It will lead to erosion of profits and cashflow. Putting returns in line with those in the foreign markets. This will depress valuations of telecos.

Foreign investors are not stupid, but they can be desperate. It is always the latter that causes deviations in excepted behavior. Some folks could be flushed with cash, itchy to use them to increase profitability (and their own credit-ability/pay check) regardless of whether it is ROE-destructive or not. It doesn't really matter to them, this is the principle-agent problem.

From strategic standpoint, some folks who are competing with Singtel in foreign markets, may want to bring the game to Singtel in their home market. You want to fight price war with me in my market, i can start price war with you in your home market now!

The Singapore Market if I understand correctly ( quick view so DYODD) seems less than 10% of Singtel.
Whereas the investment TPG has to enable locally is huge. Also TPG high bidding basically snuffle any potential price war in Australia.

TPG stock price tanks even before the battle begins.

https://www.google.com.sg/webhp?sourceid...tock+price

Will TPG walk away?
WITH the dust settling on the Singapore telecommunication sect...

http://www.businesstimes.com.sg/technolo...tor=CS3-24

(22-04-2017, 04:43 PM)weijian Wrote: From strategic standpoint, some folks who are competing with Singtel in foreign markets, may want to bring the game to Singtel in their home market. You want to fight price war with me in my market, i can start price war with you in your home market now!

(23-04-2017, 12:35 AM)corydorus Wrote: The Singapore Market if I understand correctly ( quick view so DYODD) seems less than 10% of Singtel.
Whereas the investment TPG has to enable locally is huge. Also TPG high bidding basically snuffle any potential price war in Australia.

TPG stock price tanks even before the battle begins.

https://www.google.com.sg/webhp?sourceid...tock+price

IIRC Singapore market is roughly one third of SingTel profit and about 1/2 of their operating cashflow (subsidiaries may or may not pay dividend upstream)

And yes I think what Weijian says make sense. Competitors just need to breakeven for a relatively small business in Singapore to force profitability down for Singtel, and indirectly lower the heat downunder. Question is whether TPG can last