Excerpt from CGS International Securities report.

Report Summary

• Singapore Airlines (SIA) is expected to report a strong core net profit of S\$350m-400m for 3QFY26, significantly improving from 1HFY26, driven by robust demand and stabilizing passenger yields.
• The broker has upgraded SIA to Hold from Reduce, raising the target price to S\$7.23 due to positive industry trends, including resilient premium cabin demand and limited capacity growth from aircraft delivery delays.
• Yield declines for SIA’s mainline and Scoot have moderated, and IATA projects global passenger yields to remain flat in 2026, with strong demand especially in Asia.
• Risks include potential oil price increases due to geopolitical tensions, but the outlook for SIA remains favourable with upgraded core net profit forecasts for FY26-28F by 20-70% (S\$900m-S\$1.1bn).
• SIA is advancing ESG initiatives, aiming for net zero carbon emissions by 2050, increasing the use of sustainable aviation fuels, and boosting operational efficiency to reduce costs and environmental impact.
• Dividend payout assumptions have been raised, and the company’s financial health shows stable revenue growth but moderating operating margins.
• SIA remains a sector leader in service quality and ESG commitments, though faces ongoing challenges from industry competition and associated airline performance.

Above is an excerpt from a report by CGS International Securities. Clients of CGS International Securities can be the first to access the full report from the CGS International Securities website: https://www.cgs-cimb.com