Stock Upgraded: Singtel fair value raised to 3.1 by Mrgan Stanley!

Morgan Stanley has raised its target price for Singapore Telecommunications (SingTel) to 3.10 sgd from 2.95 previously and reiterated its "overweight" rating given the firm's combination of earnings growth, balance sheet strength, and leverage to developing economies. In a client note, Morgan Stanley said it expects EPS growth of 6 pct per annum over the next three years for SingTel, together with a 5-6 pct dividend yield, and room for additional shareholder returns in the form of capital reductions. Other positive catalysts that may lift share price include further upward earnings revisions for regional affiliates; decelerating earnings reductions in Australia; and clarity on the Singapore government's national broadband policy. Morgan Stanley said further merger and acquisition activity by global carriers in search of emerging market exposure, may also boost sentiment towards SingTel. At 11.29 am, SingTel was up 0.04 sgd or 1.53 pct at 2.65 on volume of 39. 836 mln shares.