SingTel Investor Day - Maybank Research 2024-09-02: Keep Calm & Carry On

• SingTel (SGX:Z74) and its associate’s top management presented at the investor day. At the group level, we see the momentum as steady.

Key takeaways: Dividend clarity, steady operations

• - Read this at SGinvestors.io -
• Potential S$6bn in capital recycling is on target (of which S$2-3bn could come as equity from capital partners). This, coupled with improving organic cashflows and proceeds from previous capital management initiatives could allow SingTel to potentially pay at the mid-higher end of its dividend guidance, translating to an attractive 6% dividend yield.
• - Read this at SGinvestors.io -

Areas of optimism: Digital InfraCo & Bharti

• Digital Infraco business outlook is robust with SingTel targeting to double data center business EBITDA in the next 4 years. Management is also tapping GPUaaS space backed by its technology stake, Nvidia partnership and its position as national sovereign AI Cloud provider for government and large local enterprises.
• Bharti management is targeting India ARPU to hit INR300 from INR211 besides strong momentum in enterprise, data centers, and fixed broadband. Also, Bharti’s capex has likely peaked. As such Bharti is poised for strong earnings and cash flow growth (Bharti’s EPS/FCF to grow at 73%/28% CAGR over FY24-27 based on Bloomberg consensus). This could translate to dividend improvement.

Areas of concern: Telkomsel and Optus (penalties)

• Read more at SGinvestors.io.

Hussaini Saifee Maybank Research | https://www.maybank-ke.com.sg/ 2024-09-02 SGinvestors.io

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