Macquarie upgrades Tiger Airways (J7X.SG) to Neutral vs Underperform, raises target to $1.80 vs $1.71, to incorporate 2Q results, accelerated fleet delivery schedule. 

Adds, Tiger’s increased total fleet estimates for FY12, FY13 to 33, 43 respectively (vs house previous forecasts of 31, 39, current size of 21 aircraft) results in +17%, +10% impact on FY12, FY13 EPS estimates. 

Expects stronger 3Q, 4Q results as December, March quarters historically more profitable. Also says, aircraft delivery acceleration a positive that will help offset start-up losses at Thai Tiger in FY12, FY13; commencement of Thai Tiger operations in 4Q FY11 should be further positive catalyst.

 

But says Tiger’s stock fully valued; target set at 50% premium to regional average; "we see better relative value in Singapore Airlines (C6L.SG), Air China (0753.HK), both rated Outperform. Tiger +0.5% at $1.91.