Telecommunications companies, often referred to as telcos, have long been regarded by investors as defensive stocks. This perception is rooted in several fundamental aspects of the industry that contribute to these telcos’ financial stability and resilience, even in challenging economic conditions.
One of the primary reasons telcos are considered defensive stocks is their ability to generate stable cash flow and consistent profits. This stability stems from substantial investments in infrastructure such as cell towers, fibre-optic networks and data centres. These assets form a robust foundation that supports reliable service delivery to a broad customer base. Moreover, telcos typically operate on a recurring revenue model, where customers subscribe to services like mobile phone plans, internet access, and cable television. This model ensures a steady income stream as subscribers make regular monthly payments for essential communication services.
In Singapore, there are currently three companies on the Singapore Exchange (SGX) that we can invest in if we want to gain exposure to the telco sector. The companies are Singtel (Z74), StarHub (CC3) and NetLink (CJLU).
For this edition of 4 Stocks This Week, we examine the stock performance and dividend yields of these telco companies.
Singtel (Z74)
Singapore Telecommunications Limited (SGX: Z74), or Singtel, is Singapore’s largest telecommunications company, serving about 4.1 million mobile customers locally.
Beyond Singapore, Singtel has strategic investments in several leading regional telecom operators, including AIS in Thailand, Bharti Airtel in India, Globe Telecom in the Philippines, and Telkomsel in Indonesia. AIS, Globe and Telkomsel are market leaders in their respective countries, while Bharti Airtel is one of India’s largest telecom operators. Singtel also wholly owns Optus, Australia’s second-largest telecommunications provider behind Telstra.
For the financial year ended 31 March 2026 (FY2026), Singtel reported net profit of S$5.61 billion, up 40% year-on-year. This was boosted by a net exceptional gain of S$2.84 billion, mainly from partial stake sales in Airtel. Underlying net profit rose 12% to S$2.77 billion, driven mainly by Airtel, AIS, NCS, Digital InfraCo and Optus.
Singtel’s dividend policy is to pay out between 70% and 90% of underlying net profit as core dividends. For FY2026, Singtel declared total dividends of 18.5 cents per share, comprising core dividends and value realisation dividends, up 9% from 17.0 cents in FY2025. This comprised a core dividend of 13.4 cents per share, representing an 80% payout ratio of underlying net profit, and a value realisation dividend of 5.1 cents per share funded by proceeds from its asset recycling programme. The total dividend amounted to approximately S$3.05 billion.
Investors may also be watching the impact of Singtel’s Special Discounted Shares (SDS) transfer exercise. The SDS were originally offered to Singaporeans during Singtel’s 1993 public listing and have since been held under a special CPF arrangement. From 2026, these shares will be transferred to shareholders’ CDP accounts, giving holders direct ownership and allowing them to sell their shares and receive the proceeds in cash rather than having the funds returned to CPF. For long-time SDS holders, this provides greater flexibility in managing their investment.
Read Also: Why Do Older Singaporeans Who Never Bought Stocks Have SingTel Shares In Their CPF Account?
StarHub (Z74)
StarHub Ltd (SGX: CC3) is Singapore’s second-largest telecommunications provider, offering mobile, broadband, pay TV, cybersecurity and enterprise services.
For the financial year ended 31 December 2025 (FY2025), StarHub reported service revenue of S$2.0 billion and total revenue of S$2.4 billion. Net profit attributable to shareholders came in at S$86.4 million. Excluding the impact of the one-off forfeiture payment related to the return of one lot of 700MHz spectrum rights, underlying net profit would have been S$100.5 million. The group’s performance was supported by continued growth in its enterprise and cybersecurity businesses, although competition in the consumer segment remained intense.
A key strategic development was the completion of StarHub’s acquisition of MyRepublic Broadband. Having already owned a controlling 50.1% stake, StarHub acquired the remaining interest and fully integrated the business. The acquisition strengthens StarHub’s position in Singapore’s broadband market, expands its customer base, and provides greater control over the MyRepublic brand and operational assets. The move is expected to enhance StarHub’s ability to compete in the highly competitive fixed broadband market while generating operational synergies over time.
StarHub pays dividends semi-annually and has maintained a shareholder-friendly payout policy. The company distributed 6.7 cents per share in FY2023 and 7.2 cents per share in FY2024. For FY2025, StarHub declared a total dividend of 6.0 cents per share, comprising an interim dividend of 3.0 cents and a proposed final dividend of 3.0 cents. The group has maintained its policy of paying the higher of 6.0 cents per share or at least 80% of net profit attributable to shareholders.
NetLink NBN Trust (CJLU)
NetLink NBN Trust (SGX: CJLU) is not a telecommunications operator. Instead, it builds, owns and operates Singapore’s nationwide passive fibre network infrastructure, which telecommunications companies such as Singtel, StarHub and M1 use to provide broadband services to homes and businesses. As of 31 March 2026, NetLink’s network connected approximately 1.33 million residential end-user connections and more than 52,000 non-residential end-user connections across Singapore.
For the financial year ended 31 March 2026 (FY2026), NetLink reported revenue of S$413.4 million, an increase of 1.6% from FY2025. Profit after tax was S$83.3 million, representing a decline of 12.6% year-on-year.
NetLink’s distribution policy is to distribute 100% of its annual cash available for distribution. The trust pays distributions semi-annually and declared a total distribution per unit (DPU) of 5.42 cents for FY2026, marginally higher than the 5.36 cents paid in FY2025. Based on its stable and recurring cash flows from Singapore’s fibre broadband infrastructure, NetLink continues to be regarded by many investors as a defensive income-generating investment.
Looking ahead, NetLink is expected to benefit from continued demand for high-speed broadband connectivity, growth in data consumption and Singapore’s ongoing digitalisation efforts. However, distribution growth is likely to remain gradual given the mature nature of its core fibre network business.
Based on its current share price of $0.98, the dividend yield is about 5.5%.
Read Also: Singapore Banks Dividend Yield And Share Price Performance
