Singtel (SGX: Z74) Stock Outlook as of 2 December 2025: 50% Rally, UBS Downgrade, AI Data Centres and Dividend Growth

Singapore Telecommunications Limited (Singtel, SGX: Z74) has quietly turned into one of 2025’s star performers on the Singapore market. The share price has surged about 51% over the past 12 months to around S$4.68 as of midday on 2 December 2025, near its 52‑week high of S$4.92. ^[1]

That kind of run is exactly what attracts both fans and skeptics. In the last few weeks you’ve had:

A UBS downgrade to Neutral after a roughly 50% year‑to‑date rally. ^[2]
Stronger‑than‑expected earnings and raised guidance for the current financial year. ^[3]
Multi‑billion‑dollar asset recycling via Bharti Airtel stake sales and a share buyback. ^[4]
A rapidly growing AI and data‑centre story through Nxera and the RE:AI cloud platform, decorated with multiple Frost & Sullivan awards. ^[5]

Let’s unpack where Singtel stands today – price, fundamentals, dividends, AI ambitions, risks – and how recent forecasts and analyst calls fit together.

Share price check: what the market is pricing in now

As of late morning on 2 December 2025:

Singtel share price: S$4.68
1‑year performance: +50.97%
Market cap: ~S$77.6 billion
Trailing P/E: ~12.7x
Dividend (ttm): S$0.17 per share (yield ~3.6–3.9% at current price) ^[6]

That 51% gain puts Singtel well ahead of the Straits Times Index. In fact, The Smart Investor flagged Singtel as the top‑performing blue‑chip in November, delivering a 12.4% total return for the month, versus about 2.2% for the STI. ^[7]

The re‑rating has two big pillars:

Earnings and dividend growth, especially in the latest half‑year.
A structural pivot from “just a telco” to a digital infrastructure and AI platform owner.

The catch, of course, is that once a stock has rerated this hard, valuation and future growth expectations matter a lot more.

UBS turns Neutral after 50% rally: what the downgrade actually says

On 1 December 2025, UBS downgraded Singapore Telecommunications from Buy to Neutral, while keeping its price target at S$4.40. ^[8]

Key points from the note:

UBS estimates Singtel’s share price is up about 50% in 2025, making it harder to call the stock “cheap” on a 12‑month view. ^[9]
The broker acknowledges the market has rightly rewarded:
- The asset recycling strategy (Bharti Airtel stake sales, etc.).
- Consistent increases in dividend per share (DPS).
UBS pegs dividend yields at around 3.9% for FY2026 and 4.2% for FY2027, versus an ASEAN telco sector average near 5%. ^[10]
Conclusion: at current prices, UBS sees the valuation as “fair” rather than clearly undervalued.

So the downgrade is less “something’s broken” and more “a lot of good news is already priced in”.

Earnings snapshot: H1 FY26 profit almost triples on one‑off gains

Singtel’s financial year ends 31 March, so the most recent results are for H1 FY26 (six months to 30 September 2025).

According to Singtel and multiple media reports: ^[11]

Net profit: S$3.4 billion, up ~176% year‑on‑year
- Driven mainly by exceptional gains from:
  - Partial stake sale in Bharti Airtel
  - The Intouch–Gulf merger
Underlying net profit: S$1.35–1.4 billion, up about 14% YoY
- Slightly below consensus but still robust. ^[12]
Revenue: down ~1.2% in reported terms to S$6.9 billion, but up ~1.9% in constant currency, as a strong Singapore dollar and weak Australian dollar dragged headline numbers. ^[13]
Operational engines:
- Optus operating earnings +27% YoY
- NCS EBIT +41%
- Regional associates (Airtel, AIS, Telkomsel, etc.) post‑tax contributions +12% ^[14]

Singtel also raised its OpCo EBIT guidance (i.e., earnings from core operations excluding associates):

Previous: high single‑digit growth
New: “high single digit to low double digit” growth for FY2026 ^[15]

This guidance uplift is a big part of why the market got excited in November.

Dividends: faster growth, but yield now below the long‑term average

Dividend‑wise, Singtel has moved from “boring income stock” back towards “growth + income”.

Recent numbers: ^[16]

Interim dividend for H1 FY26: S$0.082 per share
- Core dividend: S$0.064
- Value realisation dividend (VRD): S$0.018
- Up 17% from S$0.07 a year earlier.
FY2025 total dividend per share: S$0.189, up from S$0.156 in FY2024.
Consensus expects FY2026 DPS of about S$0.186, slightly lower than FY2025 but still elevated versus earlier years.
Beansprout estimates:
- Forward dividend yield: ~4.0%
- Current yield: about 3.9%
- Historical average yield: around 5.1% ^[17]

Translation:

Payouts are rising in dollar terms.
The yield looks modest relative to Singtel’s own history, because the share price has run so far ahead.

UBS explicitly notes this: their forecast yields (3.9–4.2%) sit below the ASEAN telco average near 5%, which is one reason they no longer see the stock as a classic high‑yield play. ^[18]

Asset recycling, Bharti Airtel and the S$9 billion war chest

The other big story behind the rally is Singtel’s aggressive capital recycling programme.

FY2025: profit growth + buyback

In May, Singtel reported FY2025 underlying net profit of S$2.47 billion, up 9% year‑on‑year, driven by Optus and Bharti Airtel. It simultaneously: ^[19]

Announced a S$2 billion share buyback over three years.
Raised its mid‑term asset recycling target from S$6 billion to S$9 billion.
Increased its final dividend to 10 cents per share.

2025 Bharti Airtel stake sales

So far in 2025, Singtel has been busy cashing out of Airtel in stages, while still keeping a sizeable stake:

May 2025:
- Sold a 1.2% direct stake in Bharti Airtel via private placement.
- Raised roughly ₹13,182 crore (~S$2.0 billion) and booked an estimated S$1.4 billion gain. ^[20]
November 2025:
- Sold another 0.8% stake (51 million Airtel shares) for about S$1.5 billion, at a ~3.1% discount to the previous close. ^[21]
- Total estimated gain: roughly S$1.1 billion.
- Singtel’s Airtel stake is now about 27.5%, down from 31.4% in 2022. ^[22]

The Smart Investor tallies these and other disposals as S$5.6 billion of capital raised so far, more than half the S$9 billion mid‑term target, and notes that net debt has dropped to around S$8.7 billion. ^[23]

The narrative for investors:

Recycling mature stakes (like Airtel) at high valuations.
Redeploying into data centres, AI infrastructure and 5G/enterprise solutions, plus share buybacks and higher dividends.

AI and data centres: Nxera, RE:AI and a possible STT GDC mega‑deal

This is where Singtel looks less like “your parents’ telco” and more like a regional digital‑infrastructure platform.

Nxera and DC Tuas: building AI‑ready capacity

Singtel’s data‑centre arm Nxera is:

Developing DC Tuas, a 58‑megawatt green data centre in Singapore.
The project is funded in part by a S$643 million green loan from a syndicate including DBS, OCBC, Standard Chartered, HSBC and UOB. ^[24]

DC Tuas is designed to support high‑density AI workloads and is expected to be operational around 2026. This facility is part of plans to almost double data‑centre capacity to around 200 MW across Singapore, Malaysia, Thailand and Indonesia by 2026, according to Frost & Sullivan’s award write‑up. ^[25]

RE:AI – GPU‑as‑a‑Service and Frost & Sullivan recognition

Singtel’s RE:AI platform – an AI cloud service run by Digital InfraCo – is explicitly built around GPU‑rich infrastructure and Singtel’s Paragon orchestration platform. Recent milestones: ^[26]

Frost & Sullivan 2025 Southeast Asia Competitive Strategy Leadership Recognition in the GPU‑as‑a‑Service industry.
RE:AI provides on‑demand access to high‑end GPUs like NVIDIA H100 and GB200, with plans to deploy GB300 Grace Blackwell Superchips in 2026.
It leverages liquid‑cooled, energy‑efficient data centres, pitched as both high‑performance and aligned with net‑zero goals.

In parallel, Singtel itself has been named Frost & Sullivan’s 2025 Asia‑Pacific Company of the Year in the 5G Enterprise industry, recognising its leadership in 5G solutions for enterprises and digital transformation. ^[27]

Taken together, this wraps Singtel in a very 2025‑friendly story: AI, GPUs, sovereign cloud, quantum‑safe networking and 5G enterprise instead of just SIM cards and fibre lines. ^[28]

STT GDC: potential S$5 billion data‑centre acquisition

On top of its own Nxera build‑out, Singtel is in advanced talks with KKR to buy more than 80% (effectively full control) of ST Telemedia Global Data Centres (STT GDC) for over S$5 billion, according to Reuters. ^[29]

Key points:

KKR currently owns ~14% of STT GDC, Singtel over 4%, and the rest is held by ST Telemedia (Temasek).
STT GDC runs 100+ data centres across Asia and Europe, with over 2 GW of IT load in markets including Singapore, India, Japan, the UK, Germany and Italy. ^[30]
If completed, this would be one of Asia’s largest data‑centre deals, explicitly linked to booming AI compute demand.

Singtel has cautioned that discussions may not result in a binding agreement and urged investors to “exercise caution,” but the market clearly sees data centres + AI as the group’s next big growth curve. ^[31]

Analyst targets and valuation: is Singtel still cheap?

Despite the rally and the UBS downgrade, much of the sell‑side remains constructive.

Consensus and house targets

Beansprout compiles consensus SGX data and reports: ^[32]

Consensus share‑price target: S$5.21
Upside vs S$4.68 spot price: ~11.3%
Most recent ratings in 2025 from brokers such as DBS, Maybank, RHB, OCBC and UOB Kay Hian skew BUY / ADD / ACCUMULATE with earlier (pre‑rally) targets mostly in the S$3.58–4.40 range.

Phillip Securities’ November 2025 note is more up to date:

Target price: S$5.35 (raised from S$4.86)
Recommendation: ACCUMULATE ^[33]
Thesis highlights:
- 1H26 results in line with forecasts, with underlying PATMI up 14%. ^[34]
- Earnings growth broadening beyond Bharti to Thailand, NCS and data‑centre assets.
- Expectation of further monetisation (e.g., Gulf Development and further Airtel stake sales) plus growth from new data centres and GPU‑as‑a‑Service.

Fundamental valuation checks

Simply Wall St’s November 2025 analysis (via Webull) leans even more bullish: ^[35]

Singtel’s free cash flow (FCF) is projected to rise from ~S$1.66 billion to ~S$4.22 billion by 2029.
A two‑stage discounted cash flow model yields an intrinsic value of about S$6.51 per share, implying ~29% upside from recent levels.
The stock trades on a P/E of ~12.3x, versus:
- Telecom industry average ~16x
- Peer group average ~21.5x
Their conclusion: Singtel screens undervalued on both DCF and PE‑relative metrics.

By comparison, StockAnalysis shows a P/E of ~12.7x, a forward P/E near 22x, and a 1‑year return of ~51%, all consistent with a market that has repriced the stock but not (yet) to tech‑stock multiples. ^[36]

So you have an interesting split:

UBS: Neutral – decent business, but valuation now fair and yield no longer special. ^[37]
Most local brokers & DCF models: still see mid‑teens to high‑20s % upside to fair value, especially if data‑centre/AI growth plays out. ^[38]

Risk check: Optus outages, Triple Zero and execution risk

Before anyone gets lost in GPU‑powered euphoria, Singtel does have real risks.

Optus and the “Triple Zero” incident

Optus, Singtel’s Australian unit, has been under intense scrutiny after:

Major network outages, including a Triple Zero emergency call outage in Australia linked to multiple deaths, and a later incident affecting hundreds of emergency calls. ^[39]

Singtel’s management has:

Flagged higher costs to improve Optus’ resilience and customer support (including adding 300 call‑centre staff and moving more network support onshore). ^[40]
Warned that these costs and potential regulatory fines could pressure second‑half earnings, even while maintaining upgraded OpCo EBIT guidance. ^[41]

Short version: Optus is both a growth engine and a reputational/ regulatory risk.

Heavy capex and competition in AI & data centres

On the shiny AI side:

Data centres and GPU clouds are capex‑intensive, with long lead times and fast‑moving technology cycles.
Singtel will be competing with hyperscalers (AWS, Google Cloud, Microsoft Azure) and other regional players for enterprise AI workloads. ^[42]

If demand or pricing disappoints, or if capacity comes online slower than expected, returns on all this investment could fall short of the bullish narratives in current analysis.

Macro and FX

A strong Singapore dollar and a weak Australian dollar have already shown up as negative translation effects in H1 FY26 revenue. ^[43]
Singtel’s earnings are geographically diversified – which is good for resilience – but it also means FX and regional macro risk are baked into the story.

So, after the rally, what’s the Singtel stock story?

Summing up the moving parts as of 2 December 2025:

Bullish pillars

Structural upgrade in quality of earnings
- Underlying profit growing in the mid‑teens. ^[44]
- Broader contribution from NCS, associates and digital infrastructure, not just legacy consumer telco.
Capital‑light monetisation + capital‑heavy reinvestment
- Multi‑billion divestments from Bharti Airtel and other assets, reduced net debt and a S$2b buyback programme. ^[45]
Compounding AI / data‑centre optionality
- Nxera’s green data centres, RE:AI GPU‑as‑a‑Service, Frost & Sullivan awards, and potential STT GDC acquisition collectively position Singtel as a regional digital‑infra platform, not just a telco. ^[46]
Dividends trending up in absolute terms, with special/value‑realisation components as assets are recycled. ^[47]

Bearish / cautious pillars

Valuation no longer “obvious value”
- P/E ~12–13x is not demanding, but after a 50% run and UBS describing valuation as fair, the easy money may have been made. ^[48]
Yield below historical norms
- Sub‑4% yield vs ~5% historical average and ~5% ASEAN telco benchmarks. ^[49]
Execution + regulatory risk
- Optus outages and potential fines, plus the heavy lifting needed to turn AI/data centres into sustainably high‑margin businesses. ^[50]

Put differently:

Singtel today is a hybrid of defensive cash‑cow and growth‑platform. The 2025 rerating reflects investors waking up to that. Whether there’s more upside from here depends on how much you believe in Nxera/RE:AI, asset recycling discipline, and Optus’ ability to stay out of trouble, more than on basic mobile ARPU trends.