• Maintain BUY with lower SOP-based Target Price of SGD3.70 from SGD3.90, offering 16% upside.
• SingTel’s 1QFY19 core earnings missed expectations, at 19-20% of our and consensus estimates, on weaker regional currencies, protracted weakness at its associates (specifically Telkomsel and Airtel), and enterprise margin dilution. 
• While management has retained its earlier guidance, we take the opportunity to trim our FY19-21 core earnings forecasts by 7-9%.
• Valuation wise, the stock trades at 12.4x FY20F EV/EBIDA, or at a discount to its historical mean of 13.5x, backed by prospective dividend yields of over 5%. Singtel remains our preferred exposure to Singapore telcos, given its diversified exposure and sustainable dividends.
• Key downside risks are competition and forex.

Source: RHB Invest Research - 09 Aug 2018