StarHub leads with an 8% YTD gain in telecom sector

Alongside StarHub are Singtel and NetLink NBN Trust, averaging a 2.6% YTD total return.

StarHub leads Singapore's Telecommunication sector with an 8% gain year-to-date (YTD) as of 5 April, attributable to its evolution from a traditional to a digital telco provider.

With technologies like cloud computing, cybersecurity, artificial intelligence, and IoT, StarHub has reported a significant improvement in its Return on Equity (ROE), according to the Singapore Exchange’s (SGX) market update.

For FY23, StarHub's ROE surged to 20.7%, a substantial increase from 10.2% in FY22, indicating its enhanced efficiency in utilizing shareholder equity to generate profits. 

Moreover, the company achieved its DARE+ milestone of S$150m in net profit attributable to shareholders for FY23, demonstrating robust financial performance.

Alongside StarHub are Singtel and NetLink NBN Trust. StarHub remains one of the most actively traded stocks within the sector, SGX data showed. Together, these stocks have averaged a 2.6% YTD total return, showcasing their resilience and attractiveness to investors.

Singtel, on the other hand, has been subject to market speculation regarding potential divestment or partial divestment of its Optus Australian unit. 

ALSO READ: StarHub’s net profit soars 140.4% YoY to $149.6m in FY23

Despite rumours, Singtel clarified that there is no impending deal to divest Optus, emphasising its strategic importance within the Singtel Group. 

Singtel's share price has experienced fluctuations amidst this speculation, with the ratio spread of the Singtel share price to the AUD/SGD currency pair reverting back to the mean after a temporary surge. Singtel's strategic asset recycling efforts in recent years have included partial divestments of international assets, showcasing its commitment to optimizing its portfolio.

The telecommunication sector has witnessed significant institutional inflow, with the second-highest net institutional inflow observed over the past 14 weeks, following the industrial sector. 

The sector's resilience is reflected in the steady performance of Singtel, NetLink NBN Trust, and StarHub, which have collectively attracted $46m of combined net institutional inflow. 

The SGX said StarHub's leading position within the sector is further solidified by its upcoming ex-dividend date and the release of its FY23 Annual Report, highlighting its strategic direction and financial achievements.