SINGAPORE (Nov 22): Bookings for Singapore Airlines (SIA) in the coming months are expected to be stronger y-o-y but headwinds continue to persist in the form of cost pressures arising from elevated fuel prices and keen competition, says OCBC Investment Research.

Analyst Low Pei Han is projecting capacity growth in available seat kilometeres for FY19 of 5% for SIA, 4% for SilkAir, 16% for Scoot and 7% for the whole group compared to a year ago.

For 2HFY19, SIA has hedged 58% of its fuel requirements in jet fuel at a weighted average price of US$71, against the current MOPS price of US$87. For FY20, 52% is hedged with 17% at US$79 on average for jet fuel) and 35% at US$56 on average for Brent.

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