SIA

SIA: CEO highlights SIA is adopting a strategy to boost growth, including buying more fuel-efficient planes, building up global alliances, investing in new technology and cabin suites, and expanding into new market segments. Notes that SIA needs to find new ways to conduct sales and marketing, reduce expenditure, improve productivity and operational efficiency. Highlights co planning $14.3b in capex over the next 5 yrs (mostly on new aircraft) and is pushing ahead with its strategy of straddling the entire mkt spectrum. While working together with SilkAir on the premium end of the mkt, it has also launched Scoot and has a 1/3 stake in Tiger Airways. Amidst the tough times that the Asian premium airlines are currently facing after Cathay Pacific recently reported that its premium ticket sales fell short of expectations in Dec 2012, which prompted promotional business class fares this month. To stem the bleed, SIA recently announce that the Group is halting its all-business, non-stop services to New York and Los Angeles from 4Q this year. Street consensus estimates the stock is trading at 1.0x 2013 P/B with a target price of $11.41. The carrier will report its 3QFY13 results on 7 Feb 2013.