SingTel: Deutsche cites that SingTel's Australia and Singapore business trades in line with its widest P/E discount to peers. In both the prior cases of such a spread being reached, SingTel outperformed peers by 25%+ in the following year.
House believes there are reasons to be bullish:
1) FX headwinds are abating;
2) House believes the company is well positioned to grow in Australia, and
3) House recently turned bullish on Bharti, and now have Buy's on all three listed
associates plus Telkom.
SingTel appears attractive (17.3x) vs. the 19x P/E of the regional market, despite leaking out 9% of EBIT to Digital Life - and Deutsche expects Digital Life to either become profitable or be restructured.
House maintains Buy with Tp of $4.60.
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