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4 Stocks This Week (Aviation) [29 Mar 2019] – Singapore Airlines; SATS; SIA Engineering; China Aviation Oil

Besides airline companies, the aviation industry involves companies with businesses in catering, engineering and jet fuel.

 

There has been a lot in the news recently surrounding the aviation industry.

#1 Changi Airport was recently crowned the best airport in the world for the 7th year running. Plans to upgrade Terminal 2 have also been announced.

#2 Singapore Airlines released their own 3.03% 5-year SIA Bonds 2019 that was oversubscribed. SIA has since upsized the bond from $500 million to $750 million.

#3 Unfortunate events surrounding Boeing’s 787 Max have resulted in the aircraft being grounded till further notice.

#4 Jewel Changi Airport will be opened on 17 April. Jewel is Changi Airport’s retail and lifestyle development with more than 280 shops and food and beverage outlets.

Here are 4 stocks on SGX that play a role in the aviation industry in Singapore and around the region.

Read Also: Non-Stop Or Connecting: Which Type Of Flight Should Travellers Choose?

Singapore Airlines (SGX: C6L)

Singapore Airlines (SIA) is Singapore’s national airline, closely tied to the Singapore identity. It has gotten numerous international accolades over the years, being named the World’s Best Airline at the 2018 World Airline Awards.

SIA is an international full-service carrier. SIA also caters to other consumer segments through their subsidiaries SilkAir and Scoot. SilkAir is a regional full-service carrier while Scoot is a low-cost carrier.

SIA closed at $9.660 on Friday.

Read Also: Singapore Airlines (SIA) Retail Bond 2019: 10 Things You Need To Know Before Investing

SATS (SGX: S58)

SATS is the main ground-handling and in-flight catering service provider at Singapore Changi Airport. SATS controls about 80% of Changi airport’s ground handling and catering business. Going beyond Singapore, SATS provides gateway services and food solutions in Asia.

SATS has invested in new technology to reduce food waste by extending the shelf life of cooked food, with some food being able to be stored for up to 24 months. SATS has also extended its kitchen in Changi North, which is now able to produce up to 60,000 meals a day.

SATS has a market capitalisation of S$5.6 billion and a workforce size of over 12,000. For the past six weeks, SATS has been trading between $5.011 to $5.220

SIA Engineering (SGX: S59)

SIA Engineering (SIAEC) provides maintenance, repair and overhaul of aircraft to more than 80 international airlines worldwide. At Singapore Changi Airport, SIAEC provides line maintenance services to more than 50 airlines passing through Singapore. SIAEC has in-house workshops in close proximity to the aircraft to ensure that downtime from repairs is minimized.

Beyond Singapore, SIAEC is growing its line maintenance business in overseas countries such as Japan, United States, Australia, Hong Kong, Indonesia and Vietnam.

SIA Engineering announced a new deal with NokScoot Airlines on Friday to form a new line maintenance joint venture in Thailand. SIAEC closed higher at $2.460 on Friday.

China Aviation (SGX: G92)

Jet fuel is a major cost for airlines. China Aviation Oil (CAO) is the largest physical jet fuel trader in the Asia Pacific region and the key supplier of imported jet fuel to China’s civil aviation industry.CAO supplies jet fuel to key international airports in China as well as aviation fuel to airlines at international airports outside of China. Besides jet fuel supply and trading, CAO also has key businesses in trading of other oil products and investments in oil-related assets.

China National Aviation Fuel (CNAF) Group Limited, a large State-owned enterprise in China, is CAO’s parent company. CNAF is the largest aviation transportation logistics service provider in China, with business in aviation fuel distribution, storage and refuelling services at over 210 airports in China.

CAO has been listed on the SGX mainboard since 2001. CAO’s share price closed at $1.340 on Friday.

Read Also: Singapore Budget Airline Add-On Fees Comparison 2018

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4 Stocks This Week is not a recommendation from us to buy or sell any of these stocks. For investors who are keen to find out more, you should continue researching about them before making your investment decisions.