OCBC Investment Research raised its target price on SIA Engineering Co Ltd to S$4.48 from S$4.14 and kept its 'hold' rating, citing a positive longer-term outlook for its maintenance, repair and operations business.
By 0238 GMT, SIA Engineering shares were down 0.7 percent at S$4.37. They have gained 27.4 percent since the start of the year, compared with the Straits Times Index's 19 percent rise.
Global passenger aircraft fleet is expected to grow by 3.8 percent a year from now till 2030, with most coming from the Asian market. OCBC noted that this will benefit SIA Engineering, which has a Singapore base and regional joint ventures and associates.
The brokerage also said SIA Engineering's management expects demand for its core businesses will be sustained in the near term, despite the contraction in air freight volumes and as poor consumer confidence weighs on the aviation sector.
1040 (0240 GMT)