SIA

SIA: CLSA maintains U/p with $10.94 TP. House note that while Passenger traffic rose by a stronger than trend 8.6% YoY and the growth seems stronger in the short haul routes given the passenger growth was much higher at 11.7%, Cargo demand, which is a traditional lead indicator, continues to be lackluster. CLSA believes that as fuel prices potentially decline on improved Syria outlook and cargo capacity and costs removed, structural competition issues will limit SIA’s return outlook as LCC and Middle Eastern carriers take share.