SG Morning Call | Singapore Stocks Open Lower on Tuesday; CICT Drops 1.5%

Market Snapshot

Singapore stocks opened lower on Tuesday. STI fell 0.3%; Seatrium rose 1.6%; Dyna-Mac rose 1.5%; ThaiBev rose 1%; DBS fell 0.7%; CICT fell 1.5%; AEM fell 1.6%.

Stocks to Watch

$SIA(C6L.SI)$, $SIA Engineering(S59.SI)$: Singapore’s national carrier will spend S$1.1 billion to retrofit its Airbus A350 fleet and refresh offerings as rival airlines pump billions into upgrades. Set to finish by 2030, the makeovers will help the airline stay competitive and protect its premium travel sector share. SIA’s aircraft maintenance subsidiary SIAEC will furnish the aircraft, the company on Monday. Shares of SIA inched up 0.3 per cent or S$0.02 to S$6.46, while those of SIAEC climbed 1.2 per cent or S$0.03 to S$2.45 on Monday, before the investment plan went public.

$CapitaLandInvest(9CI.SI)$ (CLI): The real asset manager has secured a S$261 million capital commitment from Mitsui OSK Lines (MOL) for its South-east Asia and India private funds. On Tuesday, CLI said it was also closing its S$525 million CapitaLand India Growth Fund 2 (CIGF2) with S$131 million capital commitment from MOL’s real estate subsidiary, Daibiru Corporation. CLI shares closed Monday S$0.03 or 1.1 per cent higher at S$2.87.

$CapLand IntCom T(C38U.SI)$ (CICT): The real estate investment trust’s (Reit) net property income for the third quarter ended September 2024 grew 5.4 per cent to S$289.8 million. On Tuesday, its manager attributed the topline growth to higher gross rental income and lower operating expenses. Units of CICT ended Monday S$0.01 or 0.5 per cent higher at $2.04.

$NetLink NBN Tr(CJLU.SI)$: The fibre optic owner’s distribution per unit climbed 1.1 per cent on year to S$0.0268 for the first half of its 2025 fiscal year ended Sep 30. Net profit fell 8.3 per cent to S$48.5 million and revenue dropped 0.2 per cent to S$204.8 million, the trustee-manager on Monday said. Earnings per unit declined on year to S$0.0124 from S$0.0136. The counter closed up 1.1 per cent or S$0.01 at S$0.915 on Monday before the results were announced. 

$AIMS APAC Reit(O5RU.SI)$ (AA Reit): The trust’s distribution per unit for the first half of fiscal year 2025 rose 0.4 per cent to S$0.0467, from S$0.0465 in the previous corresponding period. On Tuesday, the Reit manager attributed the increase to rental growth across the trust’s logistics and warehouse, and industrial segments. Units of AA Reit ended Monday flat at S$1.27.

$Cromwell Reit EUR(CWBU.SI)$ (Cromwell E-Reit): Its net property income for the third quarter ended September 2024 grew 7 per cent year on year to 34.5 million euros (S$45.5 million). On Tuesday, the Reit manager said this was due to the completion of its Nervesa21 office redevelopment in Milan, as well as its Novo Mesto ONE Industrial Park I/III logistics development near Bratislava. Units of Cromwell E-Reit closed S$0.01 or 0.6 per cent up to 1.65 euros on Monday.

$Dyna-Mac(NO4.SI)$: Hanwha Ocean SG’s voluntary conditional cash offer for the oil-and-gas contractor at S$0.67 per share was declared unconditional on Tuesday. This applies to the offeror’s acceptance level which brings its total controlling stake to over 50 per cent of Dyna-Mac’s maximum potential issued share capital. The offer remains conditional upon a merger control condition. The counter closed Monday S$0.01 or 1.5 per cent lower at S$0.655.

SG Local News

Singapore Airlines to Spend $835 Mln Upgrading Long-Haul Airbus A350 Cabins

Singapore Airlines will spend 1.1 billion Singapore dollars ($834.66 million) to upgrade all classes on its 41 Airbus A350-900 long-haul and ultra-long-range planes by the end of 2030, the airline said on Monday.

The airline group's SIA Engineering Company will carry out the retrofitting.

The first retrofitted A350-900 long-haul aircraft is expected to enter service in the second quarter of 2026, while the first A350-900ULR variant is expected in the first quarter of 2027, the airline said.

Foreign Banks in Singapore Slash Home Loan Rates to as Low as 2.45%

Singapore’s mortgage rates have eased since the start of the year, with some foreign banks shaving rates by around 50 basis points to 2.5 per cent from the 3 per cent offered earlier.  

Based on data consolidated on mortgage broker Redbrick Mortgage Advisory’s platform as at Nov 4, banks in Singapore offered home loans with fixed interest rates ranging from 2.45 per cent up to 3.5 per cent.

The lowest offer so far this month, at 2.45 per cent, was from the Bank of China (BOC) with a lock-in period of three years. Standard Chartered and Maybank had 2.5 per cent packages, while local lenders such as DBS, OCBC and UOB offered fixed home loans starting from rates of 2.55 per cent to 2.6 per cent. 

The Business Times understands that such rates are typically deviated or “below-the-line” rates, offered directly to clients or mortgage brokers, and are not posted publicly on banks’ websites.

CapitaLand Integrated Commercial Trust Announces Higher Revenues and NPI for 9MFY2024

In its 3QFY2024 business updates, CapitaLand Integrated Commercial Trust (CICT) announced a 2% y-o-y rise in revenue for the nine months to Sept 30 (9MFY2024) to $1,189.8 million. 

Net property income (NPI) for the same period rose by 5.4% y-o-y to $872.1 million, driven by higher gross rental income from existing properties and lower operating expenses, despite the absence of income from Gallileo, which has been undergoing an asset enhancement initiative (AEI) since February.

Committed occupancy in 3Q2024 was 96.4% with weighted average lease expiry of 3.5 years. Total rental reversions for 9MFY2024 was a positive 9.2%. Tenant sales rose by 1.4% y-o-y while shopper traffic rose by 3.7% y-o-y for the same period. CICT announced total new and renewed leases of 677,200 sq ft year-to-date till Sept 30, with a tenant retention rate of 86.1%.

High Court Dismisses Changi Airport Group's Appeal for Tax Savings on S$272 Million Spent on Assets

The High Court dismissed an appeal by the operator of Changi Airport to claim capital allowance on S$272 million (US$206 million) it spent on assets over three years.

Changi Airport Group, which was licensed to manage Changi Airport in 2009, made claims for capital allowances under the Income Tax Act in 2011, 2012 and 2013 for capital expenditure in respect of certain assets - two runways, various taxiways and aprons.

Capital allowances are deductions claimable for the wear and tear of certain fixed assets. The amount can be deducted against chargeable business income, lowering the corporate taxes payable.  

CAG's capital expenditure in respect of these assets amounted to S$272,575,162 across the three years. However, the Comptroller of Income Tax denied the capital allowance claims.