Elevator Pitch
I maintain my "Neutral" rating on Singapore-listed telecommunication services operator Starhub Ltd. (OTCPK:SRHBF) [STH:SP]. There are signs of stabilization for Starhub's mobile and pay television businesses in 4Q2019, but competition from MVNOs and OTT players, and piracy issues remain key downside risks. Furthermore, the company expects a lower EBITDA margin in FY2020 vis-a-vis FY2019 due to a change in revenue mix, notwithstanding the success of Starhub's cost optimization program which led to higher earnings for 4Q2019.
A "Neutral rating" for Starhub is warranted. While the stock trades at below-average EV/EBITDA valuations