Singapore Telecommunications Limited (SGX: Z74) is a giant name in telecom industries. It is the most consistent dividend paying company with slow growth. However Singtel’s revenue of S$17.2 billion in fiscal 2015 (year ended 31 March 2015) is merely 2% higher than what it was five years ago in fiscal 2010. But, still I think there is also another side to Singtel – the growth angle – that many tend to overlook.
Although Singtel currently derives most of its profit from mature markets such as Singapore and Australia, the company actually has huge stakes in multiple telcos in many emerging markets like India, Thailand, Philippines, Indonesia and many other African Nations.
If we look at Singtel’s history, the profit contributions from its emerging market associates have grown at an annual rate of 6% from fiscal 2005 to fiscal 2015. This has helped the associates’ contributions to Singtel’s total net profit to grow from 29% to 46% over the same time frame.
Comparatively, Singtel’s revenue (mainly from Singapore and Australia) only grew at 3% per year from fiscal 2005 to 2015. Thus, as the emerging markets continue to grow, their income contributions may become more and more important for Singtel.
Considering all the numbers for last 10 years, SingTel can be a growth stock that can be looked upon for investing.
Fantastic information help you to trade in the right direction so make sure you never miss a trading opportunity by checking them on a regular basis.
ReplyDeleteTo get more updates on Singapore Stocks Watch and best Singapore Stocks Tips, Click here SGX stock tips