Singapore Airlines: Earnings bottoming but Air India drag remains

研报英文原文证据摘录

Singapore Airlines: Earnings bottoming but Air India drag remains

Global Research

29 July 2026ab

Singapore Airlines Equities

SingaporeEarnings bottoming but Air India drag remains

Airlines

12-month rating Neutral

Jun-Q likely mark the trough quarter

Jun-Q marked the worst quarter since Mar-22 driven by a sharp rise in fuel cost. 12m price target S$7.60

However, quarterly revenue reached a record high, supported by resilient passenger

flight demand despite elevated airfare as well as robust cargo demand thanks to the

Price (28 Jul 2026) S$7.77

movements of semiconductors and data center related goods. As the fuel price retreats,

we expect margins to recover and exceed pre-conflict level as fare and freight rate RIC: SIAL.SI BBG: SIA SP

adjustments are unlikely to fully offset the decline in fuel costs. We continue to believe

Trading data and key metrics

passenger yield will remain above pre-conflict level in the foreseeable future. Despite an

52-wk range S$7.84-6.26

improving outlook for SIA's core businesses, Air India will likely remain a drag before its

carrying value (S$1.1bn as of Mar-26) is fully written off. Also, potential capital call Market cap. S$23.0b/US$17.8b

remains a key overhang as it presents additional risk to near-term ROIC. The stock is Shares o/s 2,963m (ORD)

trading at 1.5x forward P/B, which is 2.4SD above historical average on the back of Free float 42%

11.1% average ROE in FY3/27-31E, which reflects balanced risk reward in our view. We Avg. daily volume ('000) 8,384

maintain our Neutral rating. Avg. daily value (m) S$60

Common s/h equity (03/27E) S$17.2b

Revenue environment remains highly constructive P/BV (03/27E) 1.3x

The quarterly net loss was primarily driven by a 76% YoY increase in post-hedge jet fuel Net debt to EBITDA (03/27E) 0.2x