** Shares in Australian telecom firm Tuas Ltd TUA.AX fall as much as 6.5% to A$2.160

** Telecom firm on Friday terminated a deal worth S$1.43 billion ($1.12 billion) to buy Keppel's KPLM.SI stake in mobile operator M1 via its unit Simba Telecom

** Morgan Stanley shifts Australia's Tuas TUA.AX valuation to its base case, removing M&A upside

** Brokerage says shares look dislocated from fundamentals, reflecting negative sentiment and regulatory uncertainty

** Keeps earnings forecast unchanged, citing strong organic growth and recent beats across revenue, EBITDA and subscriber additions

** Flags key uncertainties on capital allocation and potential spectrum breaches under investigation in Singapore

** Stock down 68.46% this year, including the day's move

($1 = 1.2765 Singapore dollars)