4 Key Insights to Learn from Singapore Telecommunications Limited’s Management

Singapore Telecommunications Limited  (SGX: Z74) is the largest listed company in Singapore. It is also the largest player among the trio of telecommunications services providers in Singapore (the other two are M1 Ltd (SGX: B2F) and StarHub Ltd (SGX: CC3)).

Given Singtel’s heft, there might be things investors can learn from its management team. Recently, Singtel’s chief corporate officer, Jeann Low, gave an interview. I had picked out four key insights that may be useful for investors:

1. The importance of teamwork– click here

2. Focus on customers– click here

3. Venturing outside Singapore’s shores

“In those early days, Singtel took stakes in European telcos as they were first in the industry to liberalise. But later, we decided to focus on Asia, because we are based in the region, and we do know and understand Asia better.”

Singtel contemplated moving overseas two decades ago. Low recounted the board’s decision to expand because the Singapore market was deemed to be too small. The company started with Europe but eventually decided to focus on growth in Asia.

At the time of the interview, Singtel held around 33% of India Bharti Airtel, 35% of Indonesia’s PT Telkomsel, around 23% of Thailand’s Advanced Info Service (AIS) and around 47% of Globe Telecom in Philippines. Regional associates account for nearly half of Singtel’s net profit. Singtel had recently proposed to increase its stake in AIS and Bharti Airtel.

4. The Optus decision

“Singtel’s leadership had the foresight, and was able to act fairly quickly when opportunities arose. I believe we have executed well over the years – Optus was burning close to A$1 billion of cash when we acquired it, but we helped to turn it around with the management team in place. That’s where disciplined execution comes in.”

Beyond its associates, Singtel also owns Australia’s Optus.

It wasn’t a straightforward decision to acquire Optus. At the time, Optus was burning close to A$1 billion in cash. Low recounted how Singtel had to bring disciplined execution to the table to turn the situation around. For the financial year ended 31 March 201 (FY2016), Australia contributed 24% of Singtel’s net profit.

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The information provided is for general information purposes only and is not intended to be personalised investment or financial advice. Motley Fool Singapore contributor Chin Hui Leong doesn't own shares in any company mentioned.