[ET Net News Agency, 3 July 2018] HSBC Global Research trimmed its target price for
SmarTone Telecommunications (00315) to HK$9 from HK$9.7, and retained its "hold" rating.
The research house said SmarTone's results are likely to be affected by wireless
competition dating from early September 2017, when HKT (06823) launched discounts targeted
at it and its MVNO partner HKBN (01310) (despite HKBN having just 3% of its customers,
nearly all of whom were just a few months into a two-year contract).
HSBC said this competition at the high end of the market makes it more difficult for all
operators to raise prices at the low end of the market. SmarTone should be able to offset
some of this impact from customer growth via HKBN, and its continued focus on cost
reductions.
But SmarTone is expanding its enterprise services, with a particular focus on
construction, transportation, real estate and logistics. It is open to partnering to roll
out a NB-IOT platform. It is also looking to develop partnerships in these areas, as well
as work more closely with its parent company. (KL)