Brokers' take: CGS-CIMB raises dividend estimates for Singtel's Thai associate AIS
CGS-CIMB has raised its dividend payout ratio assumption for Singtel Thai associate Advanced Info Service (AIS) to 90 per cent from 75 per cent.
Having a higher dividend payout may help boost the telco's share price, the research team said in a report on Friday.
AIS remains CGS-CIMB's top pick for the sector. It reiterates its "add" call on AIS with a higher discounted cash flow-based target price of 251 baht (S$10.33), from 209 baht previously.
AIS shares were trading 0.8 per cent or 1.5 baht higher to 190 baht as at 12.29pm on Friday on the Stock Exchange of Thailand.
CGS-CIMB projects AIS' free cash flow to rise by 210.4 per cent to 36.2 billion baht in FY2021 and by 26.1 per cent to 45.7 billion baht in FY2022. This will allow AIS to comfortable accommodate the 90 per cent dividend payout ratio.
Moreover, Gulf Energy Development said in an analyst meeting on Aug 10 that it aims to maximise dividend income and optimise assets from Intouch Holdings and its subsidiaries.
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Thai-listed power producer Gulf in April launched a bid to buy over stakes in AIS, where Singtel has a 23.3 per cent interest; and AIS' controlling shareholder Intouch Holdings, where Singtel has a 21.2 per cent ownership.
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