Progressing as planned, but a few areas of weakness Of Singtel's 8 business units (4 core and 4 associates), 6 are tracking within or ahead of expectations. Telkomsel's softness remains a concern while the house sees initial signs of weakness in Singapore mobile. Capital return remains on track, helped by SGD2b in proceeds from capital recycling over 2024-25, and potential part divestment in Bharti and Gulf (newco) stakes for the next leg of its capital recycling. Following 1HFY25 results, Maybank has trimmed the core earnings estimates by 2-5% and TP to SGD3.65 (from SGD3.70), mainly on the back of cuts in associate estimates. The house assigns BUY call on Singtel.

Core: impressive cost cuts but slight SG mobile cracks
1HFY25 core revenue grew 2% YoY, helped by Optus mobile (up 4% YoY), data centres (up 17% YoY) and NCS (up 3% YoY). Singapore mobile revenue increased 4% YoY in 1H, but fell 4% QoQ. Competition has increased in Singapore (new mobile packages are available at

Associates: TSEL softness, can Bharti compensate?
Telkomsel's contribution declined 18% YoY in 1HFY25. Similar to Singapore, management sees potential mobile consolidation in Indonesia is fuelling competition. Indihome's growth also softened, although management remains optimistic of it reverting back to growth as integration of Telkomsel and Indihome is almost completed and as Indihome rolls out new home passes. While Telkomsel's softness would weigh on associate dividends, management sees potential increase in dividends from Bharti
to help. However, we note Singtel has only 9% direct stake in Bharti while the remaining 20% is through BTL. Higher Bharti dividends to BTL may be used to service its own debt and as such may not be upstreamed to Singtel.

Capital return: two targets to help meet the goals
The house sees two potential capital-recycling targets over the medium term: 1) equalization of its own stake in Bharti with the Mittal family and 2) Divestment of its stake in Gulf Energy (newco).