SIA Engine

SIA Engine: Kim Eng maintains buy with TP of $5.00 based of historical peak of 20X PE. Note that airlines are finally catching up and expanding capacity faster, with travel volumes growing 4% and capacity 6% Ytd, citing accelerating growth in past few mths even as traffic growth came off…

Adds that SIAE business traditionally lags the rest of the airline industry, and business should remain robust, with stable traffic volumes sustaining its line maintenance business while faster expansion in capacity should boost its heavy maintenance business. Recommends that in the money investors may want to use further strength to cash out, as stock approaches previous peak of $5.