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 for short, is the largest telco in Singapore with about 4.1 million mobile customers in Singapore.
Besides Singapore, Singtel also invests in regional markets such as AIS in Thailand, Airtel in India, Globe in the Philippines, and Telkomsel in Indonesia. AIS, Globe and Telkomsel are the top telcos in market position in their respective countries while Airtel is number two in the South Asian country. Singtel also fully owns Optus, the second-biggest telco in Australia, behind the leader Telstra.
For its FY2025 results announced on 22 May 2025, Singtel announced a net profit of $4.02 billion for the year. Part of the result for this is due to a net exceptional gain of S$1.55 billion, mainly from the partial divestment of its Comcentre headquarters.
Singtel’s dividend policy aims to pay core dividends between 70% and 90% of underlying net profit.
Decline In Dividends From 2018 To 2021
From 2018 to 2021, its dividend payout declined from 20.5 cents per share in 2018 (inclusive of a one-off special dividend of 3.0 cents) to 7.5 cents as of 2021.
Increase In Dividends From 2022
In 2022, the dividend payout increased to 9.3 cents. In 2023, it also increased to 14.9 cents (including a 5.0 cent special dividend). For 2024, dividends increased once again to 15.0 cents (inclusive of a 3.8 cent value realisation dividend). Singtel says this is the third dividend increase since the strategic reset three years ago. For 2025, Singtel paid a total core dividend of 12.3 cents, representing a payout ratio of 82% of underlying net profit. There is also a value realisation dividend of 4.7 cents, bringing the total dividend for the year to 17.0 cents.
As of 15 August 2025, Singtel’s share price is $4.10, up about 33% since the start of the year. The company currently has a market capitalisation of about $68 billion.
Read Also: Why Do Older Singaporeans Who Never Bought Stocks Have SingTel Shares In Their CPF Account?
StarHub (Z74)
In its 1H2025 results announcement, StarHub reported a revenue of $1.1 billion for 1H2025. Net profit after tax for the period was $47.9 million, after accounting for a one-off forfeiture payment of $14.1 million for the return of one-lot of 700MHz spectrum rights.
Earlier in the week, StarHub (Z74) announced that it had completed the acquisition of MyRepublic Broadband Pte Ltd (MR Broadband). Before this, StarHub already owned 50.1% of MR Broadband. StarHub believes that the move will enable deeper strategic alignment by securing both brand equity and critical operational assets of MyRepublic Broadband, reinforcing StarHub’s position in the Singapore market.
StarHub pays dividends semi-annually, and FY2023 dividends are at 6.7 cents per share. For FY2024, the dividend was at 7.2 cents per share. Interim dividends for 1H2025 are at 3.0 cents per share, with the company also reiterating its dividend outlook of at least 6.0 cents per share for FY2025.
Based on its current share price of $1.18 as of 15 August 2025, and assuming the dividend will be similar to FY2024, this gives a dividend yield of about 5.6%. StarHub’s current market capitalisation is about $2.04 billion.
NetLink NBN Trust (CJLU)
NetLink (CJLU) isn’t a telco. Rather, it builds, owns and operates the passive fibre network infrastructure for homes and non-residential premises and non-building address points (NBAP) in Singapore. This is the same fibre network that the other telco providers (i.e. Singtel, StarHub, M1,) use to provide broadband access to you. It has approximately 1.3 million residential end-user connections and more than 45,000 non-residential end-user connections.
For FY2025, NetLink revenue was at $407 million, about 1% lower compared to FY2024. Profit after tax was $95.4 million, 7.6% lower than FY2024.
NetLink’s distribution policy is to distribute 100% of its cash for distribution semi-annually. The dividend payout for FY2025 is at 5.36 cents, up 0.06 cents compared to FY2024.
Based on its current share price of $0.905, the dividend yield is about 5.9%. Its market capitalisation is about $3.52 billion.
Read Also: Singapore Banks Dividend Yield And Share Price Performance
