Singtel share price to blow up in pieces?
LIFETIME MEMBERSHIP 27 May 2021 will be destiny day for Singtel share price as the full-year financial result will be unveiled. Yet on 14 May 2021, Singtel management shocked investors by revealing that the results for financial year ended 31 March 2021 are expected to include net exceptional losses of $1.21 billion. Should investors run for their lives before Singtel share price blew up in pieces?
In my opinion, credit must be given to the management for giving retail investors ample warning about the upcoming headwind. Hand on heart, I am impressed by the management’s transparency. With this upfront caveat, at least most investors will be mentally prepared for the 27 May result. However, at the back of most investors’ mind must be the scale of collateral damage on the final dividend.
Widely viewed as a dividend stock, Singtel is extremely popular among Singaporean investors as many retirees depend on this evergreen counter for passive income. For FY2020, underlying net profit declined 13% to $2.46 billion. As a result, the total dividends decreased to 12.25 cents from 17.5 cents in FY2019. With the bombshell revelation of net exceptional losses, I expect Singtel share price to come under severe pressure …