Underlying valuation of SingTel's share
Going into 2009, the whole stock market will continue to face many challenges, most of them coming from the macroeconomic front. Besides having to contend with a global economic slowdown, investors will also encounter continued uncertainty brought on by the financial meltdown and credit crunch, currency instability, and increased volatility in the stock markets. In such a highly unpredictable climate, we believe that a flight to quality is not enough - investors should also focus on defensiveness of earnings as well as sustainable dividend payout abilities and most of the Singapore telcos meet these criteria.
From Singapore Exchange, SingTel's share price has fallen from $3.60 to $2.58 and it seems to be a good time to enter market and made some purchasing on SingTel's share. Before making any decision, we need to have fundamental and quantitative analysis to fully understand the potential of a company and determine the range of fair values Singapore Telecoms shares may be worth, based on the valuation methods and the forecasting.
OVERVIEW OF SINGTEL
SingTel is Asia's leading communications group with operations and investments around the world and the largest listed company in singapore. Incorporated in March 1992, SingTel became a public company in October 1993. The following month, SingTel was listed on the Singapore Exchange ("SGX"). Today, they are the largest company listed on the SGX with a market capitalisation of S$62 billion (US$45 billion) as at 31 March 2008.
With significant operations in Singapore and Australia (through wholly-owned subsidiary SingTel Optus), the Group provides a comprehensive portfolio of services that includes voice and data over fixed, wireless, Internet and satellite platforms as well as pay TV. Its other businesses include the sale of telecommunications equipment.
Australia is a major market for SingTel. they were...