Broker Name: CGS International

Date of Report: March 2, 2026

Excerpt from CGS International report.

Report Summary

• SATS Ltd reported 9MFY26 PATMI of S\$235m (+14% yoy), forming 84% of CGS/Bloomberg consensus FY26 forecasts due to a seasonally strong 3Q, and is on track to meet its FY29 financial targets.
• Revenue grew 8% yoy/5% qoq in 3QFY26 to S\$1.65bn, with cargo volume growth outpacing global air cargo demand for nine consecutive quarters, though EBITDA margins softened due to higher operating expenses.
• Disruptions in the Strait of Hormuz may drive a near-term shift from sea to air cargo, potentially boosting SATS’s air cargo services due to its global presence.
• Management maintains guidance for double-digit EPS CAGR for FY26-28 and reaffirms confidence in reaching FY29 targets, despite some operational delays in India and Thailand.
• CGS International reiterates an Add call with a higher DCF-based target price of S\$4.53, citing resilient commercial growth, robust margin outlook, and potential re-rating catalysts such as higher dividends and food solutions growth.
• Key risks include softening cargo volumes and a potential aviation industry slowdown from a global economic downturn.
• ESG: SATS’s LSEG ESG combined score is C+ due to post-acquisition integration; however, its governance rating is strong and ongoing sustainability efforts may benefit margins over time.

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