Singapore Airlines (SIA) reported a 59% drop in Q1 FY2025/26 net profit to S$186 million, largely due to losses from its 25.1% stake in Air India and increased competition impacting passenger yields. Operating profit fell 13.8% to S$405 million, despite a 1.5% revenue increase to S$4.79 billion. Shares dropped over 8% following the July 28, 2025, earnings release, with a noted price of S$7.11 after the decline.
Regarding an entry price point for SIA stock, CGS Internationals analyst report suggests a target price of S$6.80, indicating a 10.5% downside from the July 28, 2025, price of S$7.60, reflecting concerns over Air India’s losses and high valuations. Maybank also downgraded SIA to a "SELL" rating, citing weaker cargo demand and higher operating costs, which could further pressure earnings.
Given the current challenges, including Air India’s ongoing recovery from a June 2025 crash and competitive pressures, a cautious approach is warranted. An entry point around S$6.80–S$6.90 aligns with the analyst target and recent share price lows (e.g., S$6.88 on June 13, 2025, post-crash). This range could offer a margin of safety, but monitor Air India’s recovery and SIA’s cost control measures, as these are critical to future performance.
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