UPDATE 2-SingTel eyeing acquisitions; Q4 net down 17 pct
* Will look at M&A, sees Pakistan mkt consolidating
* Q4 net profit beats forecast
* Earnings impacted by strong Singapore dollar
* Shares steady in weaker Singapore market (Recasts with analysts' comments, results details)
By Harry Suhartono and Kevin Lim
SINGAPORE, May 14 (Reuters) - Singapore Telecommunications (STEL.SI) said on Thursday it was eyeing acquisitions after warning that revenue growth in its home market would slow.
Southeast Asia's largest telecommunications company posted a 17 percent drop in quarterly net profit, hurt by a strong Singapore dollar, but the fall was smaller than expected. SingTel shares slipped 0.4 percent in early trade, outperforming a 2.2 percent fall in the main Singapore stock index .FTSTI.
Facing a saturated domestic market of just 4.8 million people, SingTel (SGT.AX) has spent S$18 billion to invest in countries such as India, Indonesia, and in the bigger Australian market. Revenue growth in Singapore is expected to slow to single digits in the year to March 2010, the company said.
It did not elaborate on the targets or markets where it is eyeing acquisitions but pointed on Thursday to Pakistan as a mobile market it expected consolidation in. SingTel owns a 30 percent stake in Pakistan's Warid Telecom, the country's fourth-biggest mobile operator.
Mobile operators in Pakistan, where it sees players coming together, have started taking steps to lower costs by sharing infrastructure, said Lim Chuan Poh, who heads SingTel's operations outside Singapore and Australia.
In Bangladesh, SingTel plans to speed up its rollout of high-speed wireless broadband, he added at a results briefing.
AUSTRALIA, INDONESIA
SingTel, 55 percent-held by state investor Temasek [TEM.UL], logged January-March attributable net profit of S$903 million compared with S$1.09 billion a year ago. The earnings came above analysts' forecast for S$836.5 million, according to Reuters Estimates.
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Fourth-quarter revenue fell 5.1 percent to S$3.57 billion, while a stronger domestic currency saw full year 2008/2009 revenue rise by only 0.6 percent.
"These fourth-quarter numbers were slightly ahead of our expectations on strong margins," Deutsche Bank said in a research report, reiterating a "buy" rating on the firm.
Its Singapore operations recorded a 12.7 percent growth in fourth-quarter revenue and a 20 percent rise in earnings before interest, tax, depreciation, and amortisation (EBITDA), better than its domestic rival, StarHub (STAR.SI), which reported 0.8 percent fall in revenue and a flat EBITDA.
Full-year domestic revenue rose 13.1 percent. SingTel derived more than two-thirds of its revenue and EBITDA from its operations outside Singapore.
SingTel said its revenues from wireless broadband internet customers in its home market compensated for lower average revenue per user and minutes of usage from mobile business.
The total number of mobile phone subscribers were up 35 percent at the end of March from a year ago, it said.
Full-year revenue from its Australian unit Optus recorded 7.2 percent growth, despite the slowdown.
Its Indonesian subsidiary, PT Telekominikasi Selular (Telkomsel), reported earlier this week a 29 percent drop in its quarterly net profit as tough competition forced it to lower tariffs.
SingTel said it expected competitive pressure in Indonesia to ease in the second quarter.
"These results are likely to provide good support to a stock that has been up 10 percent in the last ten days," Citigroup said in a report after the results.
SingTel, Singapore's biggest listed firm with a market value of around $30 billion, has seen its shares rise 6.7 percent so far this year, underperforming a 21.6 percent rise in the broader market.
($1=1.461 Singapore Dollar) (Editing by Neil Chatterjee and Muralikumar Anantharaman)
