TIGER AIRWAYS HOLDINGS LIMITED
Tigerair
J7X.SI
Tiger Airways: Signs maintenance contract with Airbus
- Tiger Airways Holdings Limited’s (Tigerair) announced last evening that it has signed a 10- year agreement with Airbus relating to the maintenance of its A320ceo aircraft, which commences in early CY16.
- Tigerair currently operates a fleet of 22 A320ceo and also has 39 A320neo aircraft on firm order, with another 11 on purchase options.
- Under the agreement, Airbus will provide Fleet Technical Management (FTM) and Inventory Technical Management (ITM), which will help Tigerair optimize aircraft maintenance and engineering operations.
- Expected cost savings is ~US$20m over the 10- year contract term.
- In our view, while this agreement is positive for Tigerair, the cost savings are unlikely to be material amidst the muted outlook of Tigerair over the next 1-2 years. Hence, we keep our forecasts unchanged.
- Maintain SELL with the same FV of S$0.27.
Eugene Chua
OCBC Securities
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http://www.ocbcresearch.com/
2015-11-05
OCBC Securities
SGX Stock
Analyst Report
0.27
Same
0.27
