香港电信业：明天会更好么

《香港电信业：明天会更好么》由会员上传分享，免费在线阅读，更多相关内容在行业资料-天天文库。

1、ABGlobalResearch10June2019InitiationofCoverageEquitiesHongKongTelecomSectorTelecommunicationsHongKongAbettertomorrow?Constructiveonthesector—butnear-termrisksweightedtothedownsideWeviewtheHongKongtelcomarketasoneofthebettermarketsinAsia—withrelativelyrationalplayers,shareholder-friendlyboardsan

2、dafacilitativeregulator.However,near-termrisksareweightedtothedownsideforthewirelessplayers,astheupcoming5Gauctionislikelytobemorecontestedthantherecent4Gauctionsduetolimitedspectrumavailability.Thehigh5Gspectrumpricingcouldspuroperatorstoliftwirelessprices;however,earningsanddividendsarelikelyt

3、odipfirstbeforerecovering.WepreferthepurewirelineplayerHKBN,withtherecentretracementinitssharepricesuggestingmarketscepticismontheWTTacquisition.WehaveaSellratingonSmarTone,andthinkthemarketisunlikelytohavefactoredinauctionrisksrelatingto5Gwiththestocktradingat4.9xEV/EBITDA,broadlyinlinewiththeh

4、istoricalaverage.Spectrumscarcitycouldcauseamoreheated5GauctionThetelecomregulator,theOfficeoftheCommunicationsAuthority(OFCA),issettolaunchthe5Gauctionlaterthisyear.Withonly200MHzavailableatthekey3.5GHzbandandnofurtherreleasesexpectedinthenearterm,webelievebiddingcouldbemoreheatedthanmarketexpe

5、ctations.Thisisconsistentwithexperiencesoverseas(eg,theUK,Austria)where5Gauctionshaveresultedinpricessignificantlyabovethereservepriceduetoalackofspectrum.Weareforecastingtheupcoming5GspectrumauctioninHongKongtocosttheindustryatotalofHK$6bn,withupsiderisktothisforecast.HKBNourtoppickduetostrongg

6、rowthpotentialOurpreferenceisHKBNfrommarket-sharegainsandtheWTTacquisition,whichshouldaddHK$300minnetcashflowtothebusinessinFY20E.Whileinvestorsmayhavesomeconcernsoverrecentshiftsinitsstrategy,wethinkitisontherightpathwiththecurrentfocusonsharegain.WTTwilladdsignificantfirepowertoitscapabilities

7、andnetworkcoverage,makingitamoreformidableopponentintheenterprisesegments.WiththesharepricehavingretreatedtolevelsbeforetheWTTacquisition,webelievethemarkethasnotfactoredinthesynergybenefits.Valuation:dividendyieldof5.1%slig