M1 vs Singtel vs Starhub
iPhone X Price Plan
iPhone 8 Price Plan
M1 LIMITED
B2F.SI
SINGTEL
Z74.SI
STARHUB LTD
CC3.SI
Singapore Telcos - IPhone Handset Plans – Early Adopter Rates
Holding the line for now
- With the iPhone 8 and iPhone X models set to be released, the three Singapore incumbent telcos have unveiled subsidized handset pricing plans. The iPhone 8 plans carry similar handset pricing as the prelaunch iPhone 7 plans while the iPhone X plans have a larger discount (SGD40 to SGD144 per unit).
- Combined with recent higher data allocation and unlimited data plans that carry higher ARPU commitments for SingTel (ST SP, HOLD, Target Price SGD3.83) and StarHub (STH SP, SELL, Target Price SGD2.17), the two telcos are not yet being very aggressive in retention efforts. This is logical, in our view, given that early adopter demand may constrict available supply in the near term.
- M1 (M1 SP, SELL, Target Price SGD1.59) has yet to release iPhone X pricing plans but its SIM only data plans are currently the most aggressive among the incumbents.
iPhone 8 and iPhone X plans (with 2 years contract)
| iPhone 8 64GB | iPhone 8 256GB | iPhone X 64GB | iPhone X 256GB | |
| (SGD / unit) | (SGD / unit) | (SGD / unit) | (SGD / unit) | |
| Retail price @ Singapore Apple store | 1,148 | 1,388 | 1,648 | 1,888 |
| SingTel | ||||
| SGD43 / mo plan (SGD516 / yr) | 658 | 878 | 1,108 | 1,338 |
| Discount (SGD) | 490 | 510 | 540 | 550 |
| Discount | -42.7% | -36.7% | -32.8% | -29.1% |
| SGD68.90 / mo plan (SGD827 / yr) | 428 | 648 | 878 | 1,098 |
| Discount (SGD) | 720 | 740 | 770 | 790 |
| Discount | -62.7% | -53.3% | -46.7% | -41.8% |
| SGD95.90 / mo plan (SGD1,151 / yr) | 178 | 408 | 638 | 858 |
| Discount (SGD) | 970 | 980 | 1,010 | 1,030 |
| Discount | -84.5% | -70.6% | -61.3% | -54.6% |
| SGD239.90 /mo plan (SGD2,879 / yr) | 0 | 0 | 0 | 0 |
| Discount (SGD) | 1,148 | 1,388 | 1,648 | 1,888 |
| Discount | -100.0% | -100.0% | -100.0% | -100.0% |
| StarHub | ||||
| SGD48 / mo plan (SGD576 / yr) | 606 | 831 | 1,061 | 1,285 |
| Discount (SGD) | 542 | 557 | 587 | 603 |
| Discount | -47.2% | -40.1% | -35.6% | -31.9% |
| SGD68 / mo plan (SGD816 / yr) | 424 | 648 | 878 | 1,103 |
| Discount (SGD) | 724 | 740 | 770 | 785 |
| Discount | -63.1% | -53.3% | -46.7% | -41.6% |
| SGD108 / mo plan (SGD1,296 / yr) | 85 | 309 | 539 | 764 |
| Discount (SGD) | 1,063 | 1,079 | 1,109 | 1,124 |
| Discount | -92.6% | -77.7% | -67.3% | -59.5% |
| SGD238 / mo plan (SGD2,856 /yr) | 0 | 126 | 356 | 581 |
| Discount (SGD) | 1,148 | 1,262 | 1,292 | 1,307 |
| Discount | -100.0% | -90.9% | -78.4% | -69.2% |
| M1 | ||||
| SGD42 / mo plan (SGD504 / yr) | 665 | 885 | na | na |
| Discount (SGD) | 483 | 503 | na | na |
| Discount | -42.1% | -36.2% | na | na |
| SGD62 / mo plan (SGD744 / yr) | 465 | 690 | na | na |
| Discount (SGD) | 683 | 698 | na | na |
| Discount | -59.5% | -50.3% | na | na |
| SGD102 / mo plan (SGD1,224 / yr) | 140 | 365 | na | na |
| Discount (SGD) | 1,008 | 1,023 | na | na |
| Discount | -87.8% | -73.7% | na | na |
| SGD228 / mo plan (SGD2,736 / yr) | 0 | 0 | na | na |
| Discount (SGD) | 1,148 | 1,388 | na | na |
| Discount | -100.0% | -100.0% | na | na |
| Source: Company data, Maybank Kim Eng | ||||
Pressure will mount in FY18
- After the initial wave of early adopter demand fades and as TPG Telecom’s (TPM AU, Not Rated) full mobility service or MyRepublic’s (Not Listed) mobile virtual network operator (MVNO) launches draw closer (circa mid-June 2018), we believe the pressure to re-contract subscribers will increase and so will subsidies.
- Also, what we cannot see from published rates are the offers that will ultimately come to corporate individual schemes (CIS) where the deals are sweetened but are still subject to the maximum two-year retail contract limit.
Dreaming of a bright Christmas?
- For our forecasts we have assumed that hefty subsidies start making their mark in 4Q17 with holiday spend usually coinciding with contract renewals. If iPhone demand is such that a supply bottleneck keeps subsidies per unit at bay this would be an upside risk to our near-term forecasts.
- However, the medium-term prospects of accelerating the re-contracting process going into FY18 remain, in our view.
NEGATIVE view maintained
- The initial salvo of iPhone subsidy plans does not change our outlook for the Singapore telco sector going into a more competitive situation in FY18E and onwards.
- With 17% downside to our DCF-based TP of SGD2.17 StarHub remains our least preferred pick followed by M1’s 11% downside to DCF-based TP of SGD1.59.
Luis Hilado
Maybank Kim Eng
|
http://www.maybank-ke.com.sg/
2017-09-19
Maybank Kim Eng
SGX Stock
Analyst Report
1.590
Same
1.590
3.830
Same
3.830
2.170
Same
2.170
