Brokers' take

M1 | Fully valued

Oct 14 close: S$2.87

Target price: S$2.60

DBS Group Research, Oct 14

Expect M1's dividend payout ratio to be lowered to 90 per cent versus 100 per cent last year in anticipation of higher competition ahead. M1 could be more affected than its peers from a fourth mobile player due to (i) a more price-sensitive user base; (ii) fewer number of subscribers on bundled offerings; and (iii) larger exposure to the mobile sector as percentage of group revenue.

We expect 10 per cent adverse impact on revenue by 2022 due to the fourth player. The entry of the latter will depend on the success of Hetnet trials by end of 2015; Hetnet could result in much lo…