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5 Quick Things Investors Should Learn About StarHub Ltd

StarHub Ltd (SGX:CC3) is one of the cool companies which shares its quarterly earnings webcast (the link is here).

As one of the big trio in the telecommunications industry – the others being Singapore Telecommunications Limited (SGX: Z74) and M1 Ltd (SGX: B2F) – StarHub makes its money from mobile, pay TV, broadband and fixed services.

You can read more about StarHub here.

Lumbering giant?

Below are five useful (additional) things I learned from listening to StarHub’s fourth quarter webcast:

  1. Despite competition in the broadband segment, StarHub grew its subscriber base by 21,000 year on year and kept its churn rate (rate of customers leaving) at 0.8%. Chief Executive Officer (CEO) Tan Tong Hai compared StarHub’s average revenue per user (ARPU) of S$34 with the current market rate of $49.90 for a 1 Gig Fiber broadband plan, seeing it as potential upside if StarHub is able to get more users to upgrade.
  2. On the Pay TV side, CEO Tan also shared that StarHub has the most channels that can be watched on the go. When questioned on the threat of a rival OTT (over the top) video service, CEO Tan mused that the rival OTT video service was a regional offering while StarHub was very much focused on improving the customer experience in its homeground market of Singapore.
  3. Moving on to the Mobile services segment, CEO Tan pointed towards the postpaid services as the true measure of growth. StarHub’s mobile post-paid user base increased by 5.5% year on year while churn rate was kept at 0.8%. On the other hand, its mobile pre-paid user base shrunk by about 9% in part due to a new government restriction on the number of SIMs that a person can register.
  4. Beyond individual services, StarHub’s HomeHub plan (cable TV and broadband) is catching on well. CEO Tan sees this as one of the drivers for subscriber growth.
  5. When queried on StarHub’s dividend policy, Chief Financial Officer (CFO) Nicholas Tan commented that StarHub preferred to keep its dividend consistent and predictable, as opposed to implementing a one-time hike in dividend.

Foolish takeaway

To buy and hold for a company for the long term also means keeping up with developments in the company.

The access to management teams via webcast gives the Foolish investor a fair chance to judge for themselves on whether they would like to be invested alongside the management teams that they have chosen. It also helps us put together a more complete thesis around the company and keep up with developments in its industry.

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The information provided is for general information purposes only and is not intended to be personalised investment or financial advice. Motley Fool Singapore contributor Chin Hui Leong doesn’t own shares in any companies mentioned.