SingTel - RHB Invest 2023-04-07: Telkomsel Inks Fixed-Mobile Convergence Conditional Spin-Off Agreement; Keep BUY

SingTel - Telkomsel Inks Fixed-Mobile Convergence Conditional Spin-Off Agreement; Keep BUY

SINGTEL (SGX:Z74) | SGinvestors.ioSINGTEL (SGX:Z74)
  • We believe SingTel (SGX:Z74)’s Indonesian associate’s integration with its parent’s fixed broadband (FBB) business (IndiHome) will expand its addressable market and drive customer stickiness with potential for greater ARPU uplift.
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  • We also see SingTel paying FY23F dividend at the top-end of guidance. Our target price for SingTel factors in a 6% ESG premium based on our in-house methodology.
  • - Read this at -

Fixed-mobile convergence (FMC) deal signed.

  • SingTel’s 35%-owned associate Telekomunikasi Selular (Telkomsel) has inked a conditional spin-off agreement (CSA) that will see parent Telkom Indonesia (TLKM IJ)'s wholly-owned fibre broadband wing integrated into Telkomsel’s mobile business. See SingTel's announcement dated 06 April 2023.
  • This transaction crystallises the FMC (Fixed-Mobile Convergence) strategy articulated earlier and is consistent with SingTel’s business pivot towards high-growth assets.
  • Globally, there is some evidence of FMC serving as a potent acquisition tool to snare and lock-in mobile subscribers from rivals.

Stake dilution should be viewed in the context of a larger addressable market.

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Singapore Research RHB Securities Research | 2023-04-07

Read also RHB's most recent report:
2024-06-19 SingTel - Inks JV For Malaysian Data Centre; Keep BUY.

Previous report by RHB:
2024-05-24 SingTel - Value Realisation; Maintain BUY.

Price targets by 5 other brokers at SingTel Target Prices.

Listing of research reports at SingTel Analyst Reports.

Relevant links:
SingTel Share Price History,
SingTel Announcements,
SingTel Dividends & Corporate Actions,
SingTel News Articles


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