Broker: DBS
Date of Report: 10 April 2026

Excerpt from DBS report:

Report Summary

• Key Actionable Calls:
  
  • HOLD: Cathay Pacific Airways Ltd (293_HK_Equity), Singapore Airlines Ltd (SIA_SP_Equity)
  • SELL: China Eastern Airlines Corp Ltd (670_HK_Equity), Air China Ltd (753_HK_Equity), China Southern Airlines Co Ltd (1055_HK_Equity)
• Most Important Idea:
  Elevated jet fuel prices—due to geopolitical tensions and refining disruptions—are creating significant margin pressure for airlines. This is a margin-driven shock, not a demand downturn. Earnings for APAC airlines are expected to be under pressure into 2Q–3Q26, with Chinese state-owned carriers downgraded to SELL. Prefer upstream exposure and US airlines over APAC, as APAC airline yields remain challenged.
• Highlights & Target Prices:
  
  • Cathay Pacific Airways Ltd: HOLD; 7.83% potential return
  • China Eastern Airlines Corp Ltd: SELL; -34.83% potential return
  • Air China Ltd: SELL; -17.17% potential return
  • China Southern Airlines Co Ltd: SELL; -18.85% potential return
  • Singapore Airlines Ltd: HOLD; 18.09% potential return
• Implications for Investors:
  Investors should avoid Chinese state-owned airline stocks due to persistent yield and margin pressures. Prefer US airlines and APAC aerospace/defence over regional carriers. Maintain HOLD on Cathay Pacific and Singapore Airlines. Downside risks remain for APAC airlines due to slow cost pass-through and ongoing fuel shocks.

above is an excerpt from a report by DBS. Clients of DBS can be the first to access the full report from the DBS website : https://www.dbs.com/insightsdirect