Aviation, construction to gain from airport plans

Warehousing, logistics sectors to benefit from port relocation to Tuas[SINGAPORE] Airlines, aviation-related operators and construction firms, as well as real estate investment trusts (Reits) with assets in Paya Lebar, stand to benefit the most from plans to expand and upgrade Changi Airport, according to brokerage houses.self storagePrime Minister Lee Hsien Loong had announced, in his National Day Rally speech on Sunday, ambitious plans for the airport. These include the relocation of Paya Lebar Airbase to Changi.Besides CapitaMalls Asia, which is partnering Changi Airport for Project Jewel - the proposed redevelopment of the car park site fronting Terminal 1 - airlines such as SIA and Tigerair would benefit from Singapore's continuous enhancement as a leading airport hub in the region, DBS Vickers analyst Janice Chua said in a research note yesterday."Changi's forward-looking expansion means that there should be no worries for airlines looking for more slots to grow, although this would also allow for more competition," she said.Construction-linked companies with strong track records, such as Yongnam Holdings and Pan United Corp, might also have a share in the pie, but in the longer term.Yongnam is a key provider of structural steelworks for regional airport projects, and was formerly involved in the expansion of Terminal 1 at Changi Airport, while Pan United Corp fulfilled the entire ready-mix concrete requirement for Terminal 3, Ms Chua noted."While construction on Terminal 5 is not going to begin any time soon - we believe that the contracts could be handed out towards the end of this decade - these and other redevelopment plans like Project Jewel at Terminal 1 should help sustain investor interest in the Singapore constr迷你倉ction sector."For another brokerage house OSK-DMG, the relocation of container ports to Tuas and the creation of a new Southern Waterfront City would continue to propel growth in the sector. Lian Beng Group, one of the largest main contractors in town, is the top pick, said its head of research Terence Wong.The new Tuas hub will also benefit other companies in the logistics and warehousing sectors, as well as yard players. The brokerage house views Keppel Corp as having a more attractive upside, though already fairly valued.Meanwhile, the relocation of Paya Lebar Airbase to Changi will be a positive for ST Engineering and SIA Engineering, said DBS Vickers.This is especially as firms such as ST Engineering have significant operations at Paya Lebar, with the move helping them to consolidate both military and commercial operations.For in-flight meals and ground handling services provider SATS, however, the development could be mixed, as a bigger pie could attract even more players into the segment, it said.In the long term, property values in Paya Lebar could rise, and a higher population density will also provide a ready source of labour for industrial properties, said DBS Vickers.Reits that have significant exposure to the Paya Lebar region such as Sabana, Mapletree Industrial Trust and Cambridge Reit would therefore benefit, especially from capital value expansion if plot ratios are raised in the long run, it added.On the impact of healthcare changes, DBS Vickers expects it to be minimal on private healthcare providers. OSK-DMG suggests that Raffles Medical Group could see higher patient volume at its clinics, as it is a participant of the Community Health Assist Scheme for which the age floor of 40 will be removed.文件倉