Wednesday, May 20, 2015

SATS soaring to greater heights?

When people think of SATS, they think "Aviation". That's pretty such true to a large extent. From its incorporation in 1999 where Aviation took up 100% of its revenue, the sector still takes up 80% of the current revenue in 2015.

 Air Traffic Outlook in the region
SATS recently published the presentation slides for dbAcess Asia Conference 2015 and I suggest fellow readers to take a look at it. In it, it presented the following chart:
The increase in Airport's Capacity is not without substantiated thought behind it. Boeing's report on Air traffic outlook depicts that Asia Pacific is project to grow at an annual rate of 6.3%, the highest amongst the other regions.
Singapore, being frequently voted as one of the best Airport in the world, will stand to gain from this boost in traffic growth. To make the image even rosier, let's not forget that SATS has a great presence in the Asia Pacific Airports as well.


The rise of the Middle East hub
Dubai, as we all know, is the rising Air Hub in the world, mainly due to its geographical location. What amazes me is how "80% of the population is within an 8 hour flight from the Middle East hubs".


A look through their annual report and I found that SATS had a presence in the Middle East via its Associates or JV holdings.


Chairman has also said that there're constantly looking to strengthen their presence in the Middle East and Asia. Let's hope this materialise.



Set your horizon far and SATS should do well
“In the short run, the market is a voting machine but in the long run, it is a weighing machine.” ― Benjamin Graham

 I'm intending to hold on to SATS for a long period of time and let the market does its weighing. Be patient and keep calm guys.

:)
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2 comments:

  1. FoodieFCMay 20, 2015 at 9:38 PM

    Hi, chanced upon your site by TheFinance.sg. Very insightful posts. I agree with you on SATs, long term it is gg to do well as the number of terminals increase (this is for sg alone, have not even counted other countries). Some airports in the regional although they are fairly new are already operating at max capacity! They will need to expand fast.

    vested for sometime. waiting for it to drop to get more. SAT normally increase at this time of the year when it at CD then drop again and then increase at next xd sometime in aug/nov can't remember off hand.



    ReplyDelete
  2. sgfinancemusingsMay 22, 2015 at 1:00 AM

    Hi FoodieFC,
    Thank you for dropping by and thank you for your kind comment.

    If the cycle continues,I'll be accumulating as well (although it already forms a large portion of my portfolio) =D

    ReplyDelete

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