APAC Signal-to-Noise: AI capex beneficiaries – initiate Kehua & Huaqin at Buy

Research evidence excerpt

APAC Signal-to-Noise: AI capex beneficiaries – initiate Kehua & Huaqin at Buy

Singapore Airlines: Upgrade to Buy, pricing power taking off

Our analyst Nathan Gee believes Singapore Airlines (SIA) is well positioned to gain market share and pricing

power amid ongoing Middle East disruptions, hence upgrades the stock to Buy from U/P. Around one-third of

Asia-Europe traffic transited via the Gulf in 2025, and reduced Gulf carrier capacity (down ~20% YoY) has

allowed SIA to add flights to Europe and Australia (see note). SIA also benefits from strong passenger yield

momentum, particularly on long-haul routes where it has over 45% capacity exposure. Cargo is another

tailwind, with yields up 20-30% YoY, supported by tight supply and resilient demand. Meanwhile, its 25.1%

share of Air India’s losses (~S$1bn annually) are expected to improve as headwinds ease. SIA’s strong fuel

hedging provides a cost advantage. Valuation (1.2x 2026 PBV) remains undemanding vs. historical and peer

levels.

Exhibit 1: Stocks mentioned

Ratings, POs, Market Cap, and ADTV for stocks mentioned in this report

ADTO (1

PO Pot'l MCap yr) (USD

Company Name Analyst BBG Ticker Rating PO Upside (USD bn) mn)

Huaqin – A Zhu,Katherine 603296 CH BUY CNY 153.00 42% 17.0 184.7

Huaqin – H Zhu,Katherine 3296 HK BUY HKD 105.00 37% 17.0 40.8

Kehua Data Zhao,Matty 002335 CH BUY CNY 46.00 19% 4.2 262.3

Singapore Airlines Gee,Nathan SIA SP BUY SGD 8.00 15% 17.0 33.9

Source: Bloomberg, BofA Global Research

BofA GLOBAL RESEARCH

Exhibit 21: Stocks mentioned

Pricing and Q-R-Qs for stocks mentioned in this report

BofA Ticker Company name Price Rating

XHUAF Huaqin CNY 107.54 C-1-7

XPEZF Huaqin HK$ 76.5 C-1-7

XXLAF Kehua Data CNY 38.51 C-1-7

SINGF Singapore Airlines S$ 6.97 A-1-8

2 APAC Signal-to-Noise | 07 June 2026

CR