SingTel – Lim and Tan

We Remain Neutral

Final dividend of 8 cents per share is 0.4 cent or 5% higher than we expected, which together with the 6.2 cents interim, translates to a 4.7% yield.

This is not bad, but the lowest, albeit the most sustainable in the sector.

Profit for Q4 ended Mar ’10 came to $1,015 mln, up 12.4% from a year ago. At the Underlying Profit basis, the increase was a more moderate 6.6% to $1,022 mln, bringing the total for the year ended March ’10 to $3,907 mln and $3,910 mln respectively.

Payout ratio would be 57.8%, consistent with Sing Tel’s policy of paying out 40-60% of its profits.

It’s essentially the same “story”: moderate growth in the mature Singapore and Australia (through Optus) markets, and contributions from the regional associates, although the 32% owned Bharti witnessed its first quarterly profit decline of 8.2% in the March ’10 quarter (reported 2 weeks ago), reflecting the cut-throat competition in the mobile market in India.

And our stance remains Neutral.

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