Tuesday, July 9, 2013

APTT’s yield alluring, but are the risks justifiable? (AM)

APTT’s yield alluring, but are the risks justifiable?
Asian Pay Television Trust (APTT), which is structured as a business trust, is focused on pay-TV businesses through its seed asset Taiwan Broadband Communications (TBC) Group. APTT distributes semi-annually and its first distribution per unit is guided to be 4.8 cents that is payable in September/October 2013. Since its debut on 29 May 2013 at an IPO price of S$0.97, APTT’s share price has declined by about 12.9%. We DO NOT have a ratingon APTT. At its current price of S$0.845, this leads us to consider whether investors are overpricing in the risks pertaining to APTT’s business. In today’s quick take, we therefore seek to explore some of the key investor concerns.


Risk of a non-renewal of cable licenses. We believe risks on this front are negligible, given TBC Group’s track record in satisfying the National Communications Commission of Taiwan (NCC)’s regulatory audits, digitization intiatives and its strong local content. Substantial capex needs and lengthy lead times for infrastructure development are major deterrents for new market entrants, reducing risks of a non-renewal of APTT’s cable licenses.

Re-zoning of franchise areas. NCC’s recent re-rezoning of franchise areas permits cable TV operators in Taiwan to apply for extensions of their current franchise areas. We highlight that new system operators must provide only digital cable TV services, ensuring that new competitors will not encroach on TBC Group’s existing Basic Cable TV market. TBC’s massive scale, technical expertise and well-entrenched market position should stand it in good stead to pursue expansions while long lead times and heavy capex needs could keep market players at bay.

Rate cap reductions. Rate cap reductions in future years would negatively impact APTT’s DPU. We believe APTT is most susceptible to this risk, although this could be mitigated by maintaining the quality of its cable network and services provided.

Trading at a forecasted yield of 10.6%, this begs the question: are investors overpricing in the risks here? As detailed in our analysis, we  perceive the overall risk to be low. As things stand, APTT’s risk-reward tradeoff is looking more attractive than before and it could certainly be worth taking a closer look at this high-yielding play.


Source/Extract/Excerpts/来源/转贴/摘录: AmFraser-Research,
Publish date: 09/07/13

No comments:

Post a Comment

Warren E. Buffett(沃伦•巴菲特)
Be fearful when others are greedy, and be greedy when others are fearful
别人贪婪时我恐惧, 别人恐惧时我贪婪
投资只需学好两门课: 一,是如何给企业估值,二,是如何看待股市波动
吉姆·罗杰斯(Jim Rogers)
“错过时机”胜于“搞错对象”:不会全军覆没!”
做自己熟悉的事,等到发现大好机会才投钱下去

乔治·索罗斯(George Soros)

“犯错误并没有什么好羞耻的,只有知错不改才是耻辱。”

如果操作过量,即使对市场判断正确,仍会一败涂地。

李驰(中国巴菲特)
高估期间, 卖对, 不卖也对, 买是错的。
低估期间, 买对, 不买也是对, 卖是错的。

Tan Teng Boo


There’s no such thing as defensive stocks.Every stock can be defensive depending on what price you pay for it and what value you get,
冷眼(冯时能)投资概念
“买股票就是买公司的股份,买股份就是与陌生人合股做生意”。
合股做生意,则公司股份的业绩高于一切,而股票的价值决定于盈利。
价值是本,价格是末,故公司比股市重要百倍。
曹仁超-香港股神/港股明灯
1.有智慧,不如趁势
2.止损不止盈
成功者所以成功,是因为不怕失败!失败者所以失败,是失败后不再尝试!
曾淵滄-散户明灯
每逢灾难就是机会,而是在灾难发生时贱价买股票,然后放在一边,耐性地等灾难结束
  • Selected Indexes 52 week range

  • Margin of Safety

    Investment Clock

    World's First Interactive Investment Clock