Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

<ul>
<li>Reportedly (AFR), <strong><a href="https://www.smartkarma.com/entities/singapore-telecommunications" target="_blank" data-smartkarma-citation="entities:20:1" rel="noopener">Singtel (ST SP)</a></strong> is in advanced talks to sell Optus, Australia’s second-largest telco, to Brookfield for A$16bn-A$18bn. </li>
<li>SingTel quickly <a href="https://links.sgx.com/FileOpen/SGX%20Announcement%2020240313.ashx?App=Announcement&amp;FileID=791796" target="_blank" rel="noopener">countered</a> there is no impending deal; and "<em>Optus remains an integral and strategic part of the Singtel Group and we are committed to Australia for the long term</em>."</li>
<li>Optus' EBITDA in 3Q24 and 9M24 fell 1.8% and 8.3% in S$ terms. Extrapolating out for FY24E suggests pricing under this (very) indicative Offer of around 7.6-8.6 turns of EBITDA.</li>
</ul>


Reportedly (AFR), Singtel (ST SP) is in advanced talks to sell Optus, Australia’s second-largest telco, to Brookfield for A$16bn-A$18bn. 
SingTel quickly countered there is no impending deal; and "Optus remains an integral and strategic part of the Singtel Group and we are committed to Australia for the long term."
Optus' EBITDA in 3Q24 and 9M24 fell 1.8% and 8.3% in S$ terms. Extrapolating out for FY24E suggests pricing under this (very) indicative Offer of around 7.6-8.6 turns of EBITDA.


Optus Sale Would Be A BIG Payday For SingTel

<ul>
<li>Even if you were an activist, or a trader with an activism tilt, be long <strong><a href="https://www.smartkarma.com/entities/keisei-electric-railway-co" target="_blank" data-smartkarma-citation="entities:10876:1" rel="noopener">Keisei Electric Railway Co (9009 JP)</a></strong> vs. <strong><a href="https://www.smartkarma.com/entities/oriental-land-co-ltd" target="_blank" data-smartkarma-citation="entities:13517:1" rel="noopener">Oriental Land (4661 JP)</a></strong>.</li>
<li>Reportedly, <strong><a href="https://www.smartkarma.com/entities/singapore-telecommunications" target="_blank" data-smartkarma-citation="entities:20:1" rel="noopener">Singtel (ST SP)</a></strong> is negotiating a sale of Optus. Both Singtel and Optus scotch those rumours. </li>
<li>
<strong><a href="https://www.smartkarma.com/entities/alumina-ltd" target="_blank" data-smartkarma-citation="entities:939:1" rel="noopener">Alumina Ltd (AWC AU)</a></strong> and <strong><a href="https://www.smartkarma.com/entities/alcoa-corp" target="_blank" data-smartkarma-citation="entities:6510:1" rel="noopener">Alcoa (AA US)</a></strong> enter into a Scheme. As expected. The key question: is CITIC, with 18.9% of shares out, supportive?</li>
</ul>


Even if you were an activist, or a trader with an activism tilt, be long Keisei Electric Railway Co (9009 JP) vs. Oriental Land (4661 JP).
Reportedly, Singtel (ST SP) is negotiating a sale of Optus. Both Singtel and Optus scotch those rumours. 

Alumina Ltd (AWC AU) and Alcoa (AA US) enter into a Scheme. As expected. The key question: is CITIC, with 18.9% of shares out, supportive?


Last Week in Event SPACE: Keisei Electric /Oriental Land, SingTel, Alumina/Alcoa, Li Ning

External broker reports(aggregated public sources), RHB Invest

RHB Invest

External broker reports(aggregated public sources)

RHB Investment Bank is one of the leading capital market players in Malaysia. Supported by an award-winning research team of experienced product specialists, RHB Group Investment Banking offers a full range of investment banking products and services covering primary markets, such as advisory (corporate & debt restructuring, mergers and acquisitions, takeovers), fundraising via both equity and debt instruments, and secondary markets including securities trading for both institutional and retail clients. 

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Equity Bottom-Up

<ul><li>SingTel (SGX:Z74)'s FY23 results missed on AUD weakness, albeit. with the highest dividend payout since FY19.</li><li>With FY23 return on invested capital (ROIC) rising to 8.3% (FY22: 7.3%), SingTel's management has set a new low double-digit target in the medium term.</li><li>4QFY23 core earnings of S$489m (-12.5% q-o-q, +4.4% y-o-y) brought SingTel's FY23 (Apr 2022 to Mar 2023) core earnings to S$2.05bn (+7% y-o-y), at 90% of our forecast (consensus: 93%) with the key deviation coming from the weaker AUD (-6% year-to-date).</li></ul><p><em>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.</em></p>

SingTel (SGX:Z74)'s FY23 results missed on AUD weakness, albeit. with the highest dividend payout since FY19.With FY23 return on invested capital (ROIC) rising to 8.3% (FY22: 7.3%), SingTel's management has set a new low double-digit target in the medium term.4QFY23 core earnings of S$489m (-12.5% q-o-q, +4.4% y-o-y) brought SingTel's FY23 (Apr 2022 to Mar 2023) core earnings to S$2.05bn (+7% y-o-y), at 90% of our forecast (consensus: 93%) with the key deviation coming from the weaker AUD (-6% year-to-date).Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

<div>
<p><em><strong>This week in StubWorld ...</strong></em></p>
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<div class="content-highlight">
<p><a href="https://www.smartkarma.com/entities/singapore-telecommunications" target="_blank" data-smartkarma-citation="entities:20:1" rel="noopener">Singtel (ST SP)</a>'s implied stub, net of all listcos, is currently around the lowest level outside of the GFC. </p>
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<p>Preceding my comments on SingTel are the weekly setup/unwind tables for Asia-Pacific Holdcos.</p>
<p>These relationships trade with a minimum liquidity threshold of US$1mn on a 90-day moving average, and a % market capitalisation threshold - the $ value of the holding/opco held, over the parent’s market capitalisation, expressed in percent - of at least 20%.</p>
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<p></p>
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This week in StubWorld ...


Singtel (ST SP)'s implied stub, net of all listcos, is currently around the lowest level outside of the GFC. 


Preceding my comments on SingTel are the weekly setup/unwind tables for Asia-Pacific Holdcos.
These relationships trade with a minimum liquidity threshold of US$1mn on a 90-day moving average, and a % market capitalisation threshold - the $ value of the holding/opco held, over the parent’s market capitalisation, expressed in percent - of at least 20%.





Head of Research, IPOs & Placements, Aequitas Research

Sumeet Singh

Head of Research, IPOs & Placements

IPOs and Placements coverage across Asia Pacific

Aequitas Research

We cover all listing across the Asia Pacific along with follow-up placements. As of Dec 2020, our team had covered 539 IPOs with a hit rate of 73.5% and 685 placements with a hit rate of 66.8%.

We combine fundamental bottom-up views with our proprietary quantitative framework to provide a holistic coverage across new listings and placements. Our coverage includes pre-IPO notes before the deal is launched, follow-up analysis once the deal is live and post-listing trading analysis as well.

Equity Capital Markets

<ul>
<li>
<a href="https://www.smartkarma.com/entities/vodafone-idea-ltd" target="_blank" data-smartkarma-citation="entities:15678:1" rel="noopener">Vodafone Idea (IDEA IN)</a> plans to raise around US$2.2bn via a follow-on public offering.</li>
<li>The deal has been in the works for years and proceeds will be used for capex and short-term debt repayment.</li>
<li>In this note, we will run the deal through our ECM framework and talk about the deal dynamics.</li>
</ul>



Vodafone Idea (IDEA IN) plans to raise around US$2.2bn via a follow-on public offering.
The deal has been in the works for years and proceeds will be used for capex and short-term debt repayment.
In this note, we will run the deal through our ECM framework and talk about the deal dynamics.


Vodafone Idea Placement - Very Well Flagged but Its Not Going to Fix a Whole Lot of Issues

Singapore

Singapore Telecommunications Limited wireless telecommunication services. The Company offers diverse range of services including fixed, mobile, data, internet, TV,  and digital solutions. Singapore Telecommunications serves customers worldwide.

Singtel (ST SP)

Optus Sale Would Be A BIG Payday For SingTel

SingTel is a deep value play, and an inexpensive entry into Bharti; yet the market pushes the implied stub further into negative territory. A sale...

David Blennerhassett

Last Week in Event SPACE: Keisei Electric /Oriental Land, SingTel, Alumina/Alcoa, Li Ning

The weekend is here! Pour yourself a coffee, grab a comfortable seat, and sift through a brief summary of insights on various events discussed...

David Blennerhassett

StubWorld: SingTel Plumbs Multi-Year Low

Singtel (ST SP)'s implied stub, net of all listcos, is currently around the lowest level outside of the global financial crisis.

David Blennerhassett

Vodafone Idea Placement - Very Well Flagged but Its Not Going to Fix a Whole Lot of Issues

Vodafone Idea (IDEA IN) plans to raise around US$2.2bn via a follow-on public offering. In this note, we talk about the deal dyanmics.

Sumeet Singh

Optus Sale Would Be A BIG Payday For SingTel

SingTel is a deep value play, and an inexpensive entry into Bharti; yet the market pushes the implied stub further into negative territory. A sale...

David Blennerhassett

Last Week in Event SPACE: Keisei Electric /Oriental Land, SingTel, Alumina/Alcoa, Li Ning

The weekend is here! Pour yourself a coffee, grab a comfortable seat, and sift through a brief summary of insights on various events discussed...

David Blennerhassett

SingTel - ROIC Trending Up; Keep BUY

With FY23 return on invested capital (ROIC) rising to 8.3% (FY22: 7.3%), SingTel's management has set a new low double-digit target in the medium...

RHB Invest

StubWorld: SingTel Plumbs Multi-Year Low

Singtel (ST SP)'s implied stub, net of all listcos, is currently around the lowest level outside of the global financial crisis.

David Blennerhassett

Vodafone Idea Placement - Very Well Flagged but Its Not Going to Fix a Whole Lot of Issues

Vodafone Idea (IDEA IN) plans to raise around US$2.2bn via a follow-on public offering. In this note, we talk about the deal dyanmics.

Sumeet Singh