3 reasons why StarHub margin guidance is "too conservative"

Which led Maybank to raise FY13-15 forecasts.

In its rating change report, Maybank Kim Eng said that: "We believe StarHub is being too conservative with its FY13 margin guidance of 31%, given that (1) it has consistently beaten its own guidance, (2) we do not expect the new 2013 iPhone to change the current state of the handset market, and (3) BPL odds have shifted back toward StarHub’s favour and should enable it to reverse Pay TV subscriber losses in 2H13."

This led the research firm to raise its FY13-15 forecasts by 2.5%/5%/7% respectively.

It also noted that it believes StarHub "can do better, especially if iPhone 5S disappoints." The new StarHub CEO’s enterprise-oriented strategy to drive future growth and margins has also been cited as a good catalyst for its future performance.

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