Has #ideas2invest been useful to you?
Please click here to share your feedback.
The Singapore government has further eased travel restrictions, adding nine more countries to the Vaccinated Travel Lane (VTL) scheme, bringing the total to 11 countries. It is also ramping up capacity to accommodate as many as 3,000 daily arrivals coming through VTL arrangements from November.
Quarantine-free travel under the VTL scheme is set to see the return of leisure travellers. DBS Group Research expects tourist count to grow exponentially from current levels, which bodes well for the travel and hospitality sectors, as well as selected retail S-REITs.
Ready to act now?
Simply click on the stock name below for direct access to our online equity trading platform.
Hospitality Sector
The sector has been struggling with sub-optimal occupancies for over 1.5 years since the onset of Covid-19. The return of travellers will lead to meaningful improvement in occupancy and room rates.
We like hospitality plays who can capture both inbound and outbound demand, such as Ascott Residence Trust , CDL Hospitality Trusts, and Far East Hospitality Trust.
Aviation sector
Air fares rose after the announcement, pointing to robust fundamental demand and travellers’ willingness to splurge. We believe more countries will soon join the VTL scheme, and this should consequently fuel a recovery in air passenger volumes.
However, we maintain our neutral stance on Singapore Airlines as its valuation still appears stretched. Ride on this theme via SATS Ltd instead as we expect higher passenger throughput volumes at Changi Airport to support its recovery.
Not a DBS client?
Open a trading account with us today.
2-min video
Industrial S-REITs: Rediscovering their mojo5-min article
Will property still be your pot of gold?5-min article
ETFs in Focus: S-REITs still in favour5-min article
Macro Insights Weekly: Slowing growth and higher rates?
