Broker Name: OCBC Investment Research
Date of Report: 14 November 2025
Excerpt from OCBC Investment Research report.
Report Summary
- SATS Ltd delivered strong 1HFY26 results, with revenue and PATMI up 9.1% and 11.2% year-on-year, respectively, outperforming expectations. An interim dividend of 2 Singapore cents per share was declared, up 33% from 1HFY25.
- The company’s integration of Worldwide Flight Services is progressing well, supporting group revenue growth and operational synergies. SATS aims to exceed SGD8b revenue by FY29, targeting at least 20% EBITDA margin and 15% ROE.
- Growth in Gateway Services was robust, especially in cargo volumes, though flights handled decreased slightly due to business disposals. Food Solutions growth was driven mainly by non-aviation segments.
- Operating expenses rose slower than revenue, boosting operating profit and PATMI. The revised fair value estimate for SATS is SGD3.94, using a forward P/E multiple, reflecting confidence in its diversified global business model.
- SATS’s ESG rating improved due to better raw material sourcing policies and food safety certifications. The company set ambitious emission reduction and net zero targets.
- Key catalysts include stronger cash flow, growth in associates/JVs, and higher dividends. Risks include macroeconomic uncertainty, inflationary pressure on margins, and execution challenges.
- SATS remains a leader in regional gateway services and food solutions, with a strong foothold beyond aviation and Singapore, and continues to pursue diversification and innovation for sustainable growth.
Above is an excerpt from a report by OCBC Investment Research. Clients of OCBC Investment Research can be the first to access the full report from the OCBC Investment Research website : https://www.ocbc.com/personal-banking/investments/research-reports
