M1

Telcos / M1: CLSA believes 2013 will be a tougher year for Spore’s telco operators, notes 3 unique headwinds in 2013 that were not apparent last yr. i) 4G spectrum auctions remain an unknown. LTA has delayed its ancmt which was expected late Dec ’12. ii) TV competition is heating up as SingTel continues its loss-making foray into football and non-football content iii) NGNBN must surely pick up in 2013 which stands to benefit M1 and MyRepublic (unlisted) at the margin Of the 3 telcos, CLSA prefers greater domestic exposure in M1 (Outperform) over Starhub (Underperform) and SingTel (Sell). Notes M1 is unexposed to TV and has optionality on broadband subscriber growth via NGNBN.