SIA

SIA: In Mar 2012, SIA recorded 11.8% yoy growth in carriage while capacity grew 2.9%. Consequently, load factor improved 6.3% pts to 79.5%. The no. of passengers carried increased by 10.4% over the same mth last year to 1.5m. Load factors strengthened across all route regions. South West Pacific and Europe regions led the gains as travel was boosted by the Easter holiday. Japan routes also saw strong improvement yoy as loads were affected by the Mar 2011 earthquake last year. Operating environment remains challenging amid elevated jet fuel prices. With the recent promotional fare activities, passenger yields are likely to come under pressure.

Overall cargo traffic remained weak -1.9% yoy while capacity decreased by 2.6%. Consequently, cargo load factor in March 2012 increased by 0.5 of a percentage point. Cargo load factor increased for all regions, except for East Asia and West Asia & Africa.

UOB maintains Hold with TP$11.90 and values co at FY13F P/B f 1.05x. Currently, house is of view SIA trades attractively at FY12F P/B of 0.96x compared to Cathay at 1.05x P/B.