Disclaimer: Royston Yang does not own shares in any of the companies mentioned. Earlier this year, Standard & Poor, Moody's Investors Service and Fitch Ratings revised Singtel's outlook to negative. Singtel, which gets more than half its revenue outside Singapore, has been facing intensifying competition in overseas markets where it has invested in operators including Bharti Airtel in India and Australia-based Optus. Mobile revenue consists of mobile service revenue, the sale of mobile equipment and handset leasing.
Singtel has announced a reduction in its dividend pay-out, in line with weaker sentiment and uncertainties relating to the Covid-19 pandemic. In its report, DBS said it expects Singtel to report core Ebitda (earnings before interest, tax, depreciation and amortisation) margins of below 30 per cent over the next two years due to pricing pressures in Australia and Singapore's mobile markets, and growing contribution of low-margin ICT (information and communications technology) service businesses to the telco's enterprise segment.
DBS does expect Singtel's earnings growth to resume in FY2021, but with the negatives mostly priced in. When contacted about the research report, a Singtel spokesman said there was no change from its previous guidance. SINGAPORE STRAITS TIMES STOCKS OVERSOLD OVERBOUGHT. The India-based carrier has faced airwave and license fees after the country’s operators lost a court case. Fourth quarter net income: S$574.4 million, a 26% drop from year earlier.
But China's pull is still strong, Open banking a bigger threat to Singapore banks than digital entrants: report, MOH, MAS to tighten watch on IP insurers over unfair claim rejections, Novena Global Healthcare board distances itself from Loh cousins, sets up panel to probe 'forged' accounts, Carousell aims for exit within 4 years, possibly at value of US$1.1b or more. For its last financial year ended March 31, Singtel paid a total dividend of S$0.175 per share and said that barring unforeseen circumstances, it expects to maintain this rate for its current fiscal year (FY2020). Singtel’s Dividend (5.5% after cut) Payout ratio is dangerously high. "In other words, the company has a wiggle room of S$740 million, and free cash flow will need to decline by around 20 per cent in FY2021, before it feels the pressure to cut dividends.". The telco has either maintained or raised its dividend every year for the past two decades. Maintain BUY on SingTel with a lower target price. ; With scrip dividend scheme in place, 12.25 Scts dividend per share (5.3% yield) seems easily sustainable. At Singtel's last traded share price of $2.53, this represents a trailing 12-month dividend yield of around 4.8 per cent. Singtel has announced a reduction in its dividend pay-out, in line with weaker sentiment and uncertainties relating to the Covid-19 pandemic. In a bullish scenario in which core business strengthens and associate valuations increase, DBS places Singtel's fair value at S$3.65. Singtel may cut its dividend payout from the current "unsustainable" rate to S$0.13-$0.15 per share for its next fiscal year starting April 1, 2020 (FY2021) in order to maintain its credit rating, DBS Equity Research said in a report on Thursday. The Singapore-based carrier on Thursday said it took a net exceptional charge of S$302 million for costs related to Bharti Airtel’s spectrum fees. Fair Value of S$3.24 (previously S$3.61). OCBC Investment . In the short-medium term, competition is still very much alive in 4G, but the commercial services launched by TPG Singapore is a good sign, given that it was giving out free services for more than a year. Support us and give our facebook page a 'like' or 'share' if you like the articles here! Tom K 11 months ago Dear readers, DBS Equity Research has recently commented that Singtel may cut its dividend rate starting April 2020. Moving forward, mobile revenue will remain under pressure if the pandemic does not ease up. On the topic of dividends, management highlighted that their preference is for a dividend policy that delivers sustainable dividends that grows with underlying earnings. Singapore Telecommunications Ltd. cut its expected dividend after profit slumped to the lowest since 1993. It expects associate contributions and Singtel's ability to monetise its digital businesses to be key drivers to share price performance. Dear readers, DBS Equity Research has recently commented that Singtel may cut its dividend rate starting April 2020. Better showing at its associates; looking for Australia and SG market repair.
Contributions from government investment company Temasek are included in the Net Investment Return Contribution (NIRC) framework, a key component of government budgeting. “Adverse regulatory outcomes in India and the onset of COVID-19 in the fourth quarter,” resulted in a challenging fiscal year, Singtel Group Chief Executive Officer Chua Sock Koong said in the statement. TWO SIGNS OF SINGAPORE STOCKS MARKETS REVEALED & WHAT’S NEXT! Psst! Dividend cut as firm looks to conserve capital amid pandemic, Shares slump by most in three weeks after earnings release.
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