Top telecoms' returns down 10% YTD

Its three-year average returns also dipped 10%.

The average returns of Singapore Telecommunications (Singtel), StarHub and NetLink NBN fell 10% in 2020 YTD on the back of a 4% median decline from Asia Pacific’s telecommunications stocks, according to an SGX report.

Looking at the past three years, including the total returns of NetLink NBN Trust, which has been listed for just less than three weeks short of three years, the trio averaged a 10% decline in total return.

“Returns of Singtel and StarHub, together with NetLink’s abbreviated returns for the past three years, were more defensive than telecommunication peers, with the trio averaging an 10% decline in total return, versus APAC’s median decline of 22% and a global median decline of 18%,” SGX stated in its report.

Longer term, the duo of Singtel and StarHub averaged 19% total returns over the past 10 years, performing more in line with the region, with a median decline observed for the global stocks that make up the sector.

These two were recently granted final awards for 5G deployment licences, with Singapore staying on track with its nationwide 5G standalone deployment by 2025.

In addition, SGX added that telecom firms providing 5G services are colloquially termed enablers of 5G network, whilst manufacturers are beneficiaries, with software providers representing both genres. “For the 2020 year to 29 June, the iEdge-Factset Global 5G Index, which aims to get exposure to global securities that are either enablers or beneficiaries of 5G networks, gained 7%. This bucked the trend of broader telecommunication stocks and for the past three years, the iEdge-Factset Global 5G Index gained 45%,” it said.