Maybank Kim Eng upgraded Singapore telecoms firm M1 Ltd to buy from hold and increased its target price to S$2.85 from S$2.35, saying margin worries are likely to ease.

It said Singapore's three telcos -- M1, Singapore Telecommunications Ltd and StarHub Ltd -- are breaking away from unlimited data caps on their new iPad plans. Tablets could help boost data average revenue per user, the broker said.

"We expect margin concerns for M1 to fade for a while as the new iPad should not cause a dent, the iPhone 5 launch is unlikely till October 2012 and the telco appears to have shed its previous aggressive stance on fibre," Kim Eng said.

M1 shares were down 0.8 percent, StarHub fell 1.6 percent, while SingTel gained 0.3 percent. The stocks have underperformed the broader market so far this year.

1240 (0440 GMT)

(Reporting by Eveline Danubrata in Singapore)

Reuters messaging eveline.danubrata.thomsonreuters.com@reuters.net