Starhub & M1

Starhub & M1 Earnings Preview: CIMB has earnings preview. Note that both telcos should see 4Q12 net profit weaken qoq due to seasonally-higher subscriber acquisition costs but that of StarHub should only be a little lower due to better bulk discount of devices. No change to house estimates for M1 and StarHub and house Neutral stand on the sector as it lacks rerating catalysts. StarHub (Outperform) is house top pick, with house expecting StarHub to raise its qtrly div from 5c to 6c given its multi-year low gearing and lower capex in FY13. House will preview SingTel separately.