Aug. 14 (Bloomberg) -- Singapore Telecommunications Ltd., Southeast Asia's largest phone company, said first-quarter profit rose 10 percent, exceeding analyst estimates, on record earnings at its Indian unit.

Net income climbed to S$927 million ($610 million), or 5.81 Singapore cents a share, in the three months ended June 30, from S$840 million, or 5.01 cents, a year earlier, the company said today. SingTel was expected to report profit of S$870 million, based on the median estimate of six analysts Bloomberg surveyed.

Regional affiliates such as India's Bharti Airtel Ltd. supplied half of SingTel's profit for the first time, reducing a reliance on Singapore, where there are more mobile phones than people. Chief Executive Officer Chua Sock Koong, who took over in April, extended a strategy of investing in emerging markets by buying 30 percent of Pakistan's Warid Telecom International LLC.

``SingTel is one of the best asset managers in telecoms,'' said Jankees Ruizeveld, who helps oversee $5 billion of telecommunication shares, including SingTel, at Robeco Group in Rotterdam. ``Bharti looks outstanding and poised to take full advantage of India's growth.''

Ruizeveld spoke before earnings were reported.

Shares of SingTel were unchanged at S$3.50 at the 5:05 p.m. close in Singapore, after rising as much as 1.1 percent, while the Straits Times Index rose 0.2 percent. The stock advanced 46 percent in the past year, beating the index's 38 percent gain.

First-quarter sales increased 11 percent to S$3.57 billion.

Regional Contribution

The company reiterated it expects pretax profit contribution from regional associates to rise by a ``double digit'' percentage in the year ending March 31.

SingTel's focus remains on Asian markets with ``large populations and low telephone penetration,'' Chua said at a briefing in Singapore.

Net income at regional units, including Bharti and Indonesia's PT Telekomunikasi Selular, rose 29 percent to S$463 million in the quarter.

Bharti's earnings doubled to a record 15.1 billion rupees ($372 million) after price cuts and expanded coverage in rural areas attracted 5.56 million customers, the most ever.

New Delhi-based Bharti, 30.5 percent owned by SingTel, contributed S$158 million to net income, almost doubling from S$80 million a year earlier.

SingTel yesterday said it added 12.6 million subscribers in the three months ended June, a record for a fifth straight quarter, on gains in India and Indonesia.

Net income at Sydney-based Optus Pty rose 12 percent, increasing for the second straight quarter, to A$122 million ($102 million). Sales gained 3.5 percent to A$1.9 billion.

SingTel may seek more investments in Pakistan and work with Abu Dhabi Group to expand its business there, Chua said today in an interview.

`Stellar Growth'

``Our regional mobile associates sustained their stellar growth,'' Chua said in a statement. ``Optus also performed well by maintaining growth and profitability in a highly competitive environment.''

SingTel expects ``single digit'' growth of more than 5 percent for sales in the city-state this fiscal year, Chua said.

First-quarter earnings before interest, taxes, depreciation and amortization from Singapore rose 7.3 percent to S$516 million. Sales climbed 10 percent to S$1.16 billion.

SingTel in July started a commercial pay-television service, breaking StarHub Ltd.'s stronghold in the city-state. SingTel competes with StarHub and MobileOne Ltd. in a country where there are more handsets than the 4.6 million people.

Average revenue per mobile user in Singapore was unchanged from a year earlier at S$67 per month. Customer revenue at Optus was also unchanged, at A$44.

To contact the reporter on this story: Andrea Tan in Singapore at atan17@bloomberg.net

Last Updated: August 14, 2007 05:49 EDT