SIA Revenue Record High & Yield Recovery! Is It Entering Second Spring?
This Wednesday, $SIA(C6L.SI)$ surged to a seven-month intraday high of S$7.19. Despite intensifying industry competition and downward pressure on pricing, SIA's Passenger Yield unexpectedly staged a turnaround. Is this a short-term technical bounce, or the starting gun for a new bull cycle?
1. Record Revenue vs. "Halved" Profit? The Biggest Surprise is Yield Pivot
According to the 3QFY2026 (third quarter) results, SIA delivered a set of paradoxical figures:
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Revenue: Reached S$5.51 billion, up 5.5% year-on-year, setting a new quarterly record.
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Net Profit: S$505 million, a year-on-year plunge of 68.9%.
The profit crash was not due to poor operations, but rather a high base effect. Last year’s quarter included a S$1.1 billion one-off accounting gain (primarily from the Vistara disposal). If strip out these one-off items, SIA’s operating profit actually grew by nearly 26%.
Highlight: Passenger Yield staged a turnaround.
Over the past year, as global aviation capacity recovered and low-cost carriers (LCCs) ramped up competition, airfares have faced significant downward pressure. However, SIA’s passenger yield grew 1.9% year-on-year this quarter.
This suggests SIA has regained pricing power. Whether it is the inelastic demand for Business Class or premium holiday travel, SIA remains one of the few airlines capable of making passengers pay a premium for the "Singapore Girl" brand.
2. Stock Falls After New High: What is Market Worried About?
SIA loses 1% after yesterday's new high. Despite the glittering revenue, SIA is not without its challenges. When compared to Asia-Pacific peers, market consensus remains divided.
Associates "Dragging the Chain"
This quarter, SIA recognized S$178 million in losses from associated companies, largely driven by Air India. The integration pains of the Indian market are lasting longer than expected, becoming a primary "black hole" for net earnings.
Soft Cargo Demand:
Cargo revenue fell 5.4% year-on-year, reflecting uncertainty in global trade recovery, creating a stark contrast to the booming passenger segment.
3. Institutional Outlook: A Tug-of-War Between Bulls and Bears
In the face of this rally, top investment banks have offered sharply different advice:
DBS Group Research:
Bullish (Hold/Buy bias, target prices adjusted toward S$6.50–$7.20 range) DBS views the yield improvement as a "inflection point" signal. Analyst Tabitha Foo noted that SIA's Premiumisation strategy is paying off, and this pricing edge is expected to hold through Q4, offsetting cargo weakness.
Citi Research:
Bearish (Maintaining "Sell" rating, target price S$6.28) While analyst Kaseedit Choonnawat admitted performance exceeded expectations and expected a positive short-term market reaction, he remains concerned about long-term competitive pressures and Air India's uncertainty. Citi believes the current stock price has already priced in the good news.
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Is it too late to buy in or good news already priced in?
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Do you think Air India’s losses are "temporary growing pains"?
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How much longer can SIA’s "High-Price Strategy" be sustained?
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儘管由於一次性收益缺失和印度航空虧損，整體淨利潤暴跌69%，但核心業務實際上正在飛速發展。在強勁的旅行需求推動下，季度收入達到創紀錄的$5.5 B，營業利潤增長26%，看漲者歡呼雀躍。📈
新航強勁的經營業績和乘客需求是否會超過您投資組合燃油成本上漲的壓力？👇
月線圖TA：https://ttm.financial/post/536451537248992
@Tiger_SG @TigerStars @Tiger_comments
SIA is shifting from simple high pricing to AI-driven revenue management to maintain its margins despite rising costs.
AI Dynamic Pricing: SIA is moving toward Continuous Pricing, using AI to adjust fares in real-time based on exact demand rather than traditional fixed fare buckets.
Sustainability Surcharges: Starting October 2026, the SAF (Sustainable Aviation Fuel) Levy will add up to S$41.60 to premium tickets, testing passenger loyalty.
Market Resilience: Despite higher fares, SIA maintains a dominant load factor because the global "premium travel" segment remains less price-sensitive than the budget market.
While TATA is committed to the long term, these pains have evolved into a full-scale crisis that has delayed the original recovery timeline.
Widening Deficit: Annual losses are projected to hit a record $1.6 billion (₹15,000 crore) for FY26. Operational Setbacks: The 2025 Boeing 787 crash damaged brand trust and forced expensive fleet groundings.
Geopolitical Costs: Ongoing airspace closures (e.g., Pakistan) force detours that add roughly ₹400 crore in annual fuel costs. Delayed Profitability: Management's 5-year turnaround plan was recently rejected by the board, indicating that "temporary" pains may last several more years.
Most analysts suggest the "best" entry point has passed, as current valuations reflect a peak in the travel cycle.
Overvaluation Signals: SIA (C6L) is trading around S$7.17, while fair value estimates (like the Peter Lynch model) suggest a much lower intrinsic value near S$3.60.
Analyst Outlook: The consensus price target sits at S$6.54, implying a potential 8.3% downside from current levels.
Earnings Normalization: While revenue remains high, net profits have recently dropped significantly (down 69% in Q3 FY26) because the massive one-time gains from the Vistara merger are now in the past.
营收：达55.1亿新元，同比增长5.5%，创下季度新纪录。
净利润：5.05亿新元，同比暴跌68.9%。
当然，风险依然存在。印度航空的亏损和货运需求疲软是明显的拖累。我认为印度航空更多的是长期战略痛苦，而不是结构性损害，但改善的时间表将是情绪的关键。
在目前的水平上，我认为大部分好消息都已被消化。我持谨慎的建设性态度——不追逐高点，但如果收益率势头持续，我愿意在回调时积累。
@TigerClub @TigerStars @Tiger_comments @Tiger_SG
Air India losses look more like long-term restructuring costs than structural failure. India’s aviation market is attractive, but airline turnarounds typically take 5–7 years, so earnings drag may persist near term.
SIA’s high-price strategy can likely hold through 2026 due to premium branding and hub advantage, but industry capacity is returning. As competitors expand, yields may slowly normalise rather than collapse.
Overall: quality cyclical, not peak panic nor early-cycle bargain.