“We see sector core EBITDA growing by about 12% y-oy in 2024 from a 7% y-o-y growth in 2023, largely from better operational numbers and cost restraint. SG telcos continue to offer the highest dividend yields among the ASEAN-4 telcos, at 5.5% on average for FY2024. This compares with the 4% in Malaysia, 2.7% in Indonesia, and 3.5% in Thailand,” says RHB.
RHB Research sees “some positive vibes” in the Singapore telecommunications (SG telcos) sector for this year. “We see the stronger GDP growth and peaking interest rates as supportive of Singapore’s SG telcos in 2024. Sector FY2024 EV/EBITDA of 9.4x is fair (-1SD from historical mean), given the mature stage of the market, and at a premium to the ASEAN-4 average of 6x. This is justified, in part, by superior yields,” says the Singapore research team.
The SG telcos notched under 1% return in 2023 (FSSTI: -0.3%, YTD: -2%) on stock-specific issues and earnings headwinds (investments in new capabilities and inflationary pressures).
