+ Core residential revenue stable. Core residential revenue was up 1.5% YoY in 2H21 to S$119.4mn as it added 9,424 residential connections. The impact of the pandemic was indirect, from a slower build-out of homes in the country. Our forecast for FY22e connections is 25,000 net additions (FY21: 19,339).
– Non-residential and ducts & manholes the weaker spots. Non-residential revenue contracted 4% YoY despite a modest 0.9% YoY improvement in connections to 48,108. Competition had resulted in rebates for customers. Ducts are expected to decline further with a drop in customer projects.
We expect another stable year in FY22e. Capex should be higher as reflected by a S$12.4mn rise in capital commitments to S$48.7mn. NBAP revenue is likely to gain traction from 5G rollout, although contributions remain marginal at 3% of revenue.
Maintain ACCUMULATE and TP of S$1.03
NetLink generates stable 5.2% distribution yields. Lockdowns will only result in delays in installations, diversions and co-location revenue, which account for a combined 13% of revenue.