SingTel

SingTel: BNP expects underlying net profit to decline 0.9% q/q (flat y/y) to $876m, and Optus earnings to fall 2% q/q (+2% y/y) on a softer EBITDA margin (-0.4ppt q/q) and higher net finance cost; and Singapore earnings to ease 4% q/q (-11% y/y) due to higher handset subsidies. Share of associates earnings is expected to rise 3% q/q (+9% y/y) driven by ADCANC and Bharti, offset by Globe and Telkomsel due to the 9% IDR dep’n vs SGD. BNP expects underlying net profit to decline 0.8% y/y in FY14, before resuming growth at 8.3% in FY15, and 10.1% in FY16 on stronger associate earnings, and expects payout to remain at 60-75% for FY14-16, with no special dividends. BNP maintains a hold with TP $3.80.