, Singapore

Tigerair finally ready for takeoff after four straight years in the red

The worst may be over, analysts say.

The past four years have been increasingly turbulent for budget carrier Tigerair. Although the group had been bogged down by loss-making overseas affiliates, analysts from RHB Research believe that Tigerair’s fortunes might finally turn around in FY16.

“After ridding off loss-making overseas operations, rationalising fleet size and booking significant one-time losses in the past two years, it is ready to book SGD22m in FY16 earnings, aided by higher yields on capacity discipline, better load factor and lower jet fuel costs,” said the report.

Tigerair’s yield and load factors are also poised to grow in the next couple of years on back of heightened capacity discipline. It will also benefit from more synergies with its parent carrier Singapore Airlines.

“We believe that SIA becoming Tigerair’s largest shareholder and parent is one of the key elements for its turnaround and future sustainable growth,” RHB Research said.

 

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