Tiger Airways Pte’s planned $200 million initial public offering may be facing difficulties as investors are skeptical about its financial situation and near-term outlook, Standard & Poor’s said.

Tiger Air had to scale back the size of its Singapore IPO by more than half as “sentiment on the airline industry remains fragile,” Shukor Yusof, S&P’s Singapore-based editorial director, wrote in a note today.

The low cost carrier, 49% owned by Singapore Airlines, is seeking capital to fund a fleet expansion that will include the purchase of Airbus SAS A320 aircraft. The listing may help Tiger Air compete with AirAsia Bhd., Southeast Asia’s first low-cost carrier and Jetstar Asia, which is owned by Qantas Airways.

“Tiger may not be in the best possible shape for a flotation,” Yusof wrote. “With oil prices showing renewed resurgence, airlines will continue to struggle and profitability remain an ever elusive goal.”

Tiger Air has ordered 66 Airbus A320s, 12 of which have been delivered, according to the planemaker’s Web site.

Singapore-based Tiger Air said today it received financing for two Airbus SAS planes. Standard Chartered Bank Plc was the lead arranger for the accord, the carrier said.

Tiger Air, in an e-mailed reply, declined to comment on the S&P report.