When it comes to building a portfolio for retirement, many superannuation investors prioritise stability, reliable income, and the power of compounding dividends. These portfolios aren't chasing the next speculative high-flyer. Instead, they seek out large, dependable businesses with steady earnings, low volatility, and the ability to reward shareholders year in, year out.

Telstra Group Ltd (ASX: TLS) ticks many of these boxes.

A bedrock for dividend income

Telstra is the dominant player in Australia's telecommunications market, a position it has cemented over decades. As a mature and mostly non-cyclical business, Telstra benefits from consistent cash flows generated by mobile, broadband, and enterprise services.

These recurring revenues help fund its fully franked dividend — a key drawcard for super investors seeking tax-effective income. In recent years, Telstra has returned to dividend growth, with broker forecasts suggesting a fully franked dividend of 22 cents per share in FY26. Based on current prices, that equates to a grossed-up yield of around 6%.

Strategy focused on the future

While some large-cap dividend payers risk stagnation, Telstra continues to invest heavily in its future. The company's 'Connected Future 30' strategy, unveiled in May 2025, outlines ambitious goals through to FY30, including leading Australia in mobile network experience and ranking among the top quartile of global enterprises in AI maturity.

One key initiative is the company's focus on network leadership. With ongoing investment in 5G infrastructure and digital services, Telstra aims to grow its average revenue per user (ARPU) while attracting new customers. This strategy appears to be gaining traction — in the six months to December 2024, mobile subscriber numbers grew by 119,000.

What's more, price increases for some mobile plans are expected to lift margins and support further profit growth.

Profit and dividend growth ahead?

According to UBS forecasts, Telstra's net profit is projected to rise steadily over the coming three years, a positive for dividend growth. Macquarie analysts are also upbeat. They've issued an outperform rating with a $5.28 price target — about 7.5% above recent trading levels — citing operating leverage, potential for cost reductions, and dividend growth potential as key positives.

For superannuation investors looking to 'set and forget' with quality dividend-paying stocks, Telstra presents a compelling case. It offers:

• Market leadership in a defensive sector
  
• A growing, fully franked dividend
  
• Solid long-term earnings prospects backed by clear strategic plans
  
• Analyst forecasts suggest there may still be upside in the share price

While no investment is without risk, Telstra's current trajectory makes it look like a reliable cornerstone in a retirement-focused portfolio.