SingTel (SGX:Z74)'s FY23 PATMI of S$2.23b (+14% y-o-y) missed our/consensus expectations due to FX depreciation in the region, achieving 95%/94% of the respective FY23 forecasts. On a constant currency basis, PATMI would be in line with estimates.
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Strong roaming recovery and 5G demand
SingTel's FY23 operating revenue and EBITDA fell 4.7% and 2.2% y-o-y, respectively, due to absence of contribution from Amobee and a 6% depreciation in the Australian dollar.
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Optus saw strong improvement in EBIT (+35.1% y-o-y) on solid net connections, increasing prices and growth in prepaid business.
NCS’ operating revenue (+18% y-o-y) was propelled by growth in its Enterprise and Telco business. EBITDA, however, declined by 6.3% y-o-y, impacted by higher operating expenses attributable to post-acquisition charges, as well as higher staff costs due to investments in digital capabilities to support business growth.
Notably, contributions from SingTel's regional associates rose 4.2% y-o-y, particularly Airtel’s continued momentum in India (+60% y-o-y) as it increased ARPU through higher usage and tariff hikes.
Improving ROIC target
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Above is an excerpt from a report by Maybank Research. Clients of Maybank Securities may be the first to access the full PDF report @ https://www.maybanktrade.com.sg/.
