Singtel - annual report 2017

Exposure
30% SG, threat of TPG
22% Australia, Australia regulatory review
48% regional, India price war

Lines of business
36% mobile comm, expect to be declining especially in voice and roaming
20% data and internet, increasing profits due to change in consumer lifestyle and appetite.
18% Info comm tech, increasing business in cloud computing and software as a service
12% equipment, established distribution network of handsets, apple iPhone and google Pixar phone
3% others

Growth areas
Cyber training
Mobile payments (Singtel dash )(network externalities) (airtel india payment bank license) (phillipines globe)
Shows (Philippines, singapore,  (Hollywood, Netflix, movies)
Data appetite (forced obseletion of 3G 12GB, high speed 5G data)
Sports channel
Cyber security (Japan, Australia, phillipines, nus Singapore)
Digital marketing
Internet of things

Strategy
Simon Israel, Chua sock koong

Diversification out of stagnant mobile communications to a technology company. Key risks are present but in my opinion not diwosifying out of circle of competence as acquisitions are based on utilisation of its core infrastructure. Unable to achieve organic growth in emerging business so resorting to acquisitions.(trust wave cyber security, turn amobee data analytics and digital marketing) Increased consumer base via acquisitions (in touch holdings, Bharti Telecom, Mobile) Leading to12% increase in capex

I can have exposure to the emerging technologies, backed by Singtel profitability and reliable cash flow from its dividend policy. As Singapore restructure to a smart nation, Singtel can sell the fuel that feeds the flames. Management is holding on to share and not divesting

Lines of business
Consumer - spotify music distribution, over table top video distribution, mobile payments, voice, messaging and broadband Netflix and pay TV,

Enterprise - Infocomm technology, cyber security, smart city, internet of the things, strong support from government

Digital life - digital marketing, data analytics, video

Risks
Threat of new entrants, oligopoly market and weakening pricing power, sim20 plans
Spectrum bidding (high one off expense) , moat against competitors, but limited capex unlimited profits
3 i/r hike in 2018, expected increased rate expense
Merger and a question resulting in 12% increase in capex and increased operating expense
Decrease in revenue and profits from 2013 onwards due to declining profit margin (are they cutting costs?). Increased in cash flow due to divestment of netlink. Increase in debt.

Key projects
LTA next generation ERP system
HDB future blueprint (smart urban habitat masterplan)
Smart hub analytics
E-commerce and cashless solutions
Lazada emarketplace, collaboration with polytechnics
Digital marketing with airbnb, dell, Lexus, snapchat, API partnership with social media
Distribution of shows with partnership with Sony, Warner Bros, Hollywood movie rental via HOOQ
Australia malls setup of retail Wi-Fi (vicinity, mirvac)

Comments

  1. B7 January 2018 at 06:08

    Hi INTJ

    Do you have Singtel?

    I've always seen Singtel more as a defensive play rather than a company who's bent on growth. They surely are growing slowly in other markets all these years, but from an overall returns does seem rather poor compared with other sectors.

    What do you think?

    ReplyDelete
    Replies
    1. INTJ14 July 2018 at 20:37

      HI B,

      Happy that you dropped by!
      Apologies for late response. I dont monitor my comments session regularly. Shall drop you an email.

      Delete

Post a Comment

Popular posts from this blog

A New Light

 A New Light After a hiatus from writing and picking myself up from the issues in my personal life, I decided it will be great to resume writing on a monthly frequency to connect with my inner self, and connect with like minded thinkers and writers.  Writing and investing is my passion regardless of whether I am getting paid for it. Even if no one is reading about it, writing keeps my mind sharp and discussions with others allows me to bounce off ideas with other experienced / astute investors. I am also thankful to have met new friends in person with a passion in investing in recent months, and reignite my passion in what I loved.  I will resume writing and blogging at https://caveatemptorvenditor.substack.com/
Read more

Portfolio Review 2019 - Performance Review

Image
Quantitative Measures Beta = 0.76, VaR = 8.92%, Expected Shortfall = 17.43% Overall - Time = 19.99% Performance Review for 2019 Beating the STI ETF benchmark is not difficult this year. As a market capitalized ETF, STI ETF was a late buyer in the REIT rally, which highlighted the downside of this methodology. Moreover, a lot of retail investors with larger proportion to REITS performed way better than me. My returns were also punished as I averaged down on Silverlake Axis on the recent price correction. I also sold off a percentage of STI ETF to increase my war chest instead of reallocating to US Stocks, resulting in the missing out of the Christmas rally and the year end momentum play. The S and P 500 trounced the returns of most market participants. I am not certain whether the blind money / DCA via index investors resulted into this phenomenon. There is significantly high PE stocks in the index constituents. Stocks could be simply getting more ...
Read more

Everybody has a plan until they get punched in the face

Image
  Everybody has a plan until they get punched in the face As the china central government continued their spree of popping up regulations in all areas of China economy (Minimum wages, living conditions for drivers, 996 working hours, gaming time for minors, wealth redistribution policies, Banning dancing  grannies , the list goes on), the steep decline in the HK/CN stock prices seem to be consolidating and taking a slight breather for now. Although I have stuck to the plan of disciplined averaging down from July till now, it is never easy to watch your favorite picks go cheaper as new rules are being drafted. It is never easy to stick to your convictions based on the research and thesis of the stocks you hold, and believe you are right amidst the market noise and chaos. Everybody has a plan until they get hit. Then, like a rat, they stop in fear and freeze.You can plan all you want, but you’re going to get hit – probably when you don’t expect it - and it’s going to hurt. ...
Read more