M1 (B2F.SG) down 0.4% at $2.24, underperforms broad market after 3Q earnings hit by surge in operating costs due to higher handset subsidies; thus 30% on-year surge in revenue translates to just 15.2% on-year rise in profits, down 3.4% on quarter, says Dow Jones. 

OCBC, which has Buy rating, raises fair value to $2.70 from $2.40, says overall results in line, with 9M10 revenue meeting 73.5% of house’s full-year forecast, 9-month net profit around 75.9% of FY10 view. 

 

Says mobile business largely stable, though “ARPU growth has thus far been muted.” Adds M1 maintains FY10 guidance, “which comes as no surprise.” Fair value rise due to more muted outlook for local interest rates, resulting in lower cost of capital. Stock trading just above 10-day moving average, last $2.235, may support today.