Singapore Airlines - Share Price Weakness – Chance To ADD?
- SIA (SGX:C6L) delivered a core net profit of S$28m in 3QFY22 (Oct 2021 to Dec 2021), which is a large S$463m positive swing from the S$435m core net loss in the immediately-preceding 2QFY22. SIA's 9MFY22 core net loss of S$837m made up 65% of our full-year loss forecast, above expectations due to stronger-than-expected cargo profits.
- We expect SIA to report core net losses once more in 4QFY22F, as we are past the year-end travel peak season and cargo demand weakened over the Lunar New Year in Feb.
- Strong oil prices have dampened investor enthusiasm for SIA, but oil price strength may be transitory, and borders may reopen convincingly by mid-22F.
- Reiterate ADD call on SIA with a slightly higher target price of S$5.88, still based on FY23F P/BV of 1.06x (+1 standard deviation from the mean since 2011) on our adjusted BVPS. We are optimistic on SIA’s prospects as we look further ahead into FY23F.
Above is the excerpt from research report by CGS-CIMB.
Clients of CGS-CIMB may access the full report in PDF @ https://www.itradecimb.com.sg/.
Raymond YAP CFA CGS-CIMB Research | https://www.cgs-cimb.com 2022-02-25 2022-02-25
Read also CGS-CIMB's most recent report:
2023-01-16 Singapore Airlines (SIA) - Time To Pocket Share Price Gains.
Previous report by CGS-CIMB:
2022-12-06 Singapore Airlines - Merger Of Vistara & Air India ~ Better Than Standing Alone.