SingTel's 100%-owned Australian unit Optus has won a contract to provide managed network services worth A$186.5m over the next four years from the Australian Taxation Office. The contract is said to be Optus' largest contract win to date in the federal government sector, which was awarded via a competitive tender. However, the financial impact of this contract is not expected to be material to the SingTel group, which posted operating revenue of S$14.9b for FY09 ended 31 Mar. Nevertheless, we remain upbeat about SingTel's prospects, both in Singapore (NBN), Australia (possible sale of network assets), as well as on its regional associates. We will be keeping a close watch on the proposed MTN-Bharti merger and will adjust our forecasts accordingly when we get more information. For now, we maintain our BUY rating and our S$3.18 fair value.