Starhub

[CY09]

My writeup on Starhub: http://investmoolah.blogspot.sg/2018/02/...d-for.html

Too lazy and long to write it out here again. Basically the presence of new virtual mobile networks such as Zero1 is a threat to Starhub's mobile revenue and cash flow. Zero1 is going to roll out unlimited data mobile plan at $30/month which comes with talktime and SMS. A similar Starhub plan costs $119.

While on the PayTV segment, Starhub is competing against OTT providers such as VIU (a subsidiary of Pacific Century), Netflix and Disney.

This is affecting starhub's ability to generate sufficient free cash flow to even support a 16 cents annual dividend payout.

[wonghw12]

My writeup on Starhub: http://investmoolah.blogspot.sg/2018/02/...d-for.html

Too lazy and long to write it out here again. Basically the presence of new virtual mobile networks such as Zero1 is a threat to Starhub's mobile revenue and cash flow. Zero1 is going to roll out unlimited data mobile plan at $30/month which comes with talktime and SMS. A similar Starhub plan costs $119.

While on the PayTV segment, Starhub is competing against OTT providers such as VIU (a subsidiary of Pacific Century), Netflix and Disney.

This is affecting starhub's ability to generate sufficient free cash flow to even support a 16 cents annual dividend payout.

Thumbs up for the analysis. It seems to be a matter of time before StarHub has to cut dividends. Btw, it might not be apples to apples comparison between both plans as StarHub focuses on handset subsidies. Its SIM only plans might be more comparable:

http://www.starhub.com/personal/store/mo...-only.html

[CY09]

My writeup on Starhub: http://investmoolah.blogspot.sg/2018/02/...d-for.html

Too lazy and long to write it out here again. Basically the presence of new virtual mobile networks such as Zero1 is a threat to Starhub's mobile revenue and cash flow. Zero1 is going to roll out unlimited data mobile plan at $30/month which comes with talktime and SMS. A similar Starhub plan costs $119.

While on the PayTV segment, Starhub is competing against OTT providers such as VIU (a subsidiary of Pacific Century), Netflix and Disney.

This is affecting starhub's ability to generate sufficient free cash flow to even support a 16 cents annual dividend payout.

Thumbs up for the analysis. It seems to be a matter of time before StarHub has to cut dividends. Btw, it might not be apples to apples comparison between both plans as StarHub focuses on handset subsidies. Its SIM only plans might be more comparable:

http://www.starhub.com/personal/store/mo...-only.html

Hi,

Yes thanks for pointing that out. The $119 data plan I mentioned is Starhub's SIM only plan. Starhub's largest data postpaid plan with phone subsidy costs $238 per month

[kelvesy]

Their latest quarter suffered badly.

Costs of doing business is rising, they had to do a perpetual securities to fund their dividends. Look at their FCF, not enough to support.

[corydorus]

Perpetual security way mainly to fund div or temp is dangerous. This mean fundamentally shaky.


Cory

[CY09]

http://www.starhub.com/personal/mobile/m...plans.html

Starhub has upped the ante by offering 6GB + free unlimited weekend data SIM only plans for $24, as compared to Singtel and M1 whose SIM only plans are 5GB at only $20; Starhub's SIM only plan seems to be a better deal because you get about 2GB more data at $4 more per month. The average data used by user in Singapore has increased from 3.6GB to 4.3GB (based on M1 statistics). What's more Starhub's SIM only plans is now opened to corporate users with added benefits unlike the other 2 telecos who has not opened their SIM only plans to corporate individuals.

Business wise, it looks like the price war among telecos is intensifying. Expect ARPU to fall despite increasing data and mobile usage by consumers. In addition, it is worth highlighting that Singapore's population may start to decline, which will naturally point to a decline in subscriber base.

The battles among Telecos are sure heating up now. Interesting times for investors like us, but certainly not for some who used to depend on telecos dividends to fund their retirement.

[Bibi]

In addition, it is worth highlighting that Singapore's population may start to decline, which will naturally point to a decline in subscriber base.

I thought our spore pop is targeting 6.9 to 10mil? How is it in declining mode?

[mkmk]

https://www.channelnewsasia.com/news/sin...g-10054202

StarHub to sell electricity, joins forces with solar energy firm Sunseap

SINGAPORE: Local telco StarHub on Monday (Mar 19) announced its intention to go beyond its traditional business of offering mobile, pay TV and broadband services to venture into the electricity sector.

In a press release, the telco said it is joining forces with local solar energy provider Sunseap to sell electricity at the soft launch of the Open Electricity Market in Jurong next month.

There will be two clean energy subscription plans offered by both companies: Green Life and Green Save.

Green Life is a 100 per cent clean energy plan targeting environmentally conscious customers. This means they will receive electricity fully produced by Sunseap’s solar systems and this will be charged at the usual regulated electricity tariff, the press release explained.

The current electricity tariff is 21.56 cents per kilowatt hours (kWh), according to the Energy Market Authority’s (EMA) website. The tariff for the next quarter has not been announced yet.

As for Green Save, customers will receive 5 per cent clean energy and get a 20 per cent discount off the regulated tariff, the companies said.

Mr Howie Lau, chief marketing officer at StarHub, said in the press release: “Working together with Sunseap, we are excited to offer households a compelling way to live a lower carbon footprint lifestyle using the sun’s energy.

“Leveraging each other’s expertise, we will bundle essential services from mobile, pay TV, broadband and electricity in attractive packages for customers, who are becoming more environmentally aware.”

StarHub is unable to provide more pricing details currently, when asked if existing subscribers to its mobile, pay TV or broadband services will have additional incentives to switch from Singapore Power and take up either of the two plans.

The telco did say that 5 per cent of its profits out of this business in the first three years will be channelled into its StarHub Clean Energy Fund, which will be used to “drive environmental conservation initiatives, including clean energy and efficiencies”. 

It was not able to disclose more specifics on how the fund will be used.

The EMA announced last October that households and businesses in Jurong will be able to buy their electricity from a retailer during the soft launch of the Open Electricity Market from next month, or continue with SP Group.

The option to shop around for electricity suppliers will be extended to the rest of Singapore in the second half of 2018.

EMA said on its website that there will be 14 retailers participating in the soft launch, including Sembcorp Power.

[BRT]

"there will be 14 retailers participating in the soft launch,"
some highlights >>> http://www.straitstimes.com/singapore/14...ity-market

i'm mixed on how good a market this will be. on one hand hyflux constantly cites the weak electricity market for underperformance, but sembcorp local generation business seems okay/doing well. consumers are clear winners though, with more choices and lower prices to be expected.

[dreamybear]

In addition, it is worth highlighting that Singapore's population may start to decline, which will naturally point to a decline in subscriber base.

I thought our spore pop is targeting 6.9 to 10mil? How is it in declining mode?

Looking at the trend in recent years(2014-2017), total pop growth is less than 1.5%(however our aging pop may reduce spending on mobile services). I am unable to attach a screen capture, but for those interested, the table can be found on Page 3 of http://www.singstat.gov.sg/docs/default-...on2017.pdf

On a separate note, TPG seems to have fired a "warning shot" today by revealing free mobile data plans for elderly ( https://www.channelnewsasia.com/news/tec...s-10056432). It remains to be seen how Starhub and the other telcos will react.