SIA, other aviation stocks take off; offers to delist firms from the SGX keep coming
Market Insights SIA, other aviation stocks take off; offers to delist firms from the SGX keep coming
SINGAPORE – Aviation companies did well on the local stock exchange last week, with Singapore Airlines (SIA), SIA Engineering and Sats closing in positive territory on May 16.
SIA on May 15 announced a 2.8 per cent jump in group revenue to a record $19.5 billion for the 2025 financial year (FY) ended March 31 , thanks to better travel demand and despite rising competition in the industry .
Group net profit, which stood at $2.8 billion, was up 3.9 per cent from the year before, another record for the airline. This was boosted by a one-off, non-cash accounting gain of $1.1 billion, following the merger of its 49 per cent-owned Indian carrier Vistara with Air India in November.
Despite the strong performance, shares of SIA rose by just 2.4 per cent through the week, closing at $6.90 on May 16.
SIA had said that it will be rewarding its employees with a 7.45-month bonus, which is lower than the 7.94-month bonus it paid in FY2024, the highest in its history. The group had 27,821 employees in FY2025, which is up by 8.6 per cent from FY2024.
At 40 cents per share in total, SIA's FY2025 dividends will also be less than the 48 cents per share it paid in FY2024.
SIA Engineering did better on the exchange, with its shares rising more than 7 per cent through the week to close at $2.42.
The company reported its results for FY2025 after the market closed on May 9, revealing that its net profit was up 43.8 per cent year on year to $139.6 million. This was on the back of a 13.8 per cent jump in revenue to $1.2 billion over the same period.
SIA Engineering said the stronger performance was supported by growth in air travel, which drove demand for its aircraft maintenance, repair and overhaul services.
Total FY2025 dividends amounted to nine cents per share, up from eight c ents per share in FY2024.
Sats shares also rose last week, by 2.8 per cent, to close at $2.99 on May 16.
The catering and ground handling company on May 15 said it will invest over $250 million to upgrade its ground operations and cargo handling infrastructure at Changi Airport over the next seven years.
This is expected to help meet rising cargo demand at Changi Airport until Terminal 5 and the Changi East Industrial Zone open in the mid-2030s.
Construction of Changi Airport's fifth and largest terminal commenced on May 14. When complete, it is expected to boost the airport's total annual capacity to around 140 million passengers, up from 90 million now.
CEO of Genting Singapore to retire
Genting Singapore shares fell last week.
On May 14, its chief executive Tan Hee Teck announced a personal decision to retire from the company on May 31.
Mr Tan, 69, will also relinquish his position as CEO of Resorts World Sentosa (RWS) as well as his other board roles. He has served the company in various capacities for around 20 years.
Executive chairman Lim Kok Thay will assume the role of acting CEO, while RWS president Lee Shi Ruh will take over as CEO of the integrated resort. Both appointments will take effect on June 1.
Mr Lim had stepped down as CEO of Malaysia's family-run conglomerate Genting Berhad in March after two decades at its helm, relinquishing the role to chief operating officer Tan Kong Han. Genting Singapore is 52.5 per cent-owned by its Malaysia parent.
The announcements came after Genting Singapore released its results for the first quarter of 2025 on May 14.
The company said revenue declined 20 per cent year on year to $626.2 million, while net profit fell by 41 per cent to $145 million over the same period.
This was due to lower gaming revenues and the temporary closure of Hard Rock Hotel for renovation and rebranding works. There were also fewer visitors to RWS during the quarter.
Analysts reckon Genting Singapore will perform better in the second half of 2025, when renovations across RWS are complete and new attractions such as the Singapore Oceanarium open.
Shares of Genting Singapore were heavily traded last week. They fell by around 2 per cent through the week and closed on May 16 at 71.5 cents.
Three more delisting offers
Another three companies received privatisation offers last week.
Frasers Property on May 14 made a second attempt to privatise Frasers Hospitality Trust for 71 cents per stapled security. That is one cent higher than what it offered to pay for the trust in September 2022 , although that deal eventually fell through when shareholders voted down the move .
On May 15, the controlling shareholders of Ossia International – group executive chairman George Goh Ching Wah, CEO Goh Ching Huat and non-executive director Goh Ching Lai – offered to take the company private for 16 cents a share.
It is the second time the three, who are brothers, are attempting to delist the company after their first offer in June 2024, at 14.5 cents per share, was unsuccessful.
Mr George Goh had announced his intention to stand in Singapore's 2023 presidential election, but was later informed that he did not qualify.
A third company, Cosmosteel Holdings, on May 15 received an offer from a group of investors to take it private at 20 cents per share.
Twelve other companies have received privatisation offers in 2025 so far. They are SLB Development, PEC, Sin Heng Heavy Machinery, Paragon Reit, Japfa, Econ Healthcare, Murata Manufacturing, ICP, Amara Holdings, Procurri Corp, Ban Leong Technologies and Sinarmas Land.
The offers of Paragon Reit, Japfa and Amara Holdings have been declared unconditional, and they will be delisted from the SGX. Earlier in May, the controlling shareholders of Sinarmas Land also made a second higher offer to take the property developer private.
Efforts are being taken to raise the number of initial public offerings (IPOs) on the SGX and offset the tide of firms opting out of the local bourse.
The Monetary Authority of Singapore and SGX RegCo on May 15 unveiled proposals to ease the IPO process, including measures to enable better price discovery on the SGX , or how a fair stock price is determined through market supply and demand . These plans are currently under public consultation.
Other market movers
Shares of Hotel Properties Limited (HPL) closed 2.3 per cent higher at $4.42.
They had risen by as much as 9.3 per cent to $4.72 in morning trading on May 16, but pared gains after the jump in trading volumes prompted a query from SGX RegCo. About 545,000 shares had changed hands.
In response to the query, HPL said it was unaware of any previously undisclosed information or other explanations for the unusual trading activity, and confirmed compliance with SGX listing rules.
In its proposals for better price discovery on the stock exchange released on May 15, SGX RegCo said it is planning to avoid publicly querying firms, acting on market concerns that doing so without regard to materiality can unnecessarily alarm investors.
Parkson Retail Asia more than doubled through the week, closing on May 16 at 14 cents. The department store operator said it will be paying a special interim dividend of four cents per share for the year, after announcing a 21 per cent year-on-year jump in first-quarter earnings to $14.7 million. At those levels, the dividend is also 50 per cent of Parkson's group net asset value.
Cordlife jumped by almost 65 per cent to 26 cents last week, following an offer by Thailand-listed Medeze Group to acquire a 10 per cent stake at 25 cents per share.
SingPost closed 8 per cent down at 57 cents, despite proposing on May 15 a special dividend of nine cents per share after booking a net exceptional gain of $222.2 million from the recent divestment of its business in Australia.
SingPost reported a net profit of $245.1 million for the full year, up 212.9 per cent from the previous year. But excluding the net exceptional gain, underlying net profit fell 40.3 per cent to $24.8 million.
At its results briefing, group chief financial officer Isaac Mah ruled out the possibility of nationalisation, even as SingPost continues to collaborate with the Government to find a profitable and sustainable operating model for the business.
What to look out for this week
Singtel and Sats will announce full-year results for the period ended March 31 on May 22 and May 23, respectively.
Shares of Chinese electric vehicle battery maker Contemporary Amperex Technology will start trading in Hong Kong on May 20. With its shares priced at HK$263 each, the offering is expected to raise HK$35.66 billion (S$5.9 billion), making it the world's largest IPO in 2025.
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