SATS – Lim and Tan

Noteworthy Share Transaction

• The airline catering / ground handling company, made its first buy-back of its own shares, buying 300,000 shares yesterday at $2.56 each.

• The stock has been under much pressure, dropping from $2.96 on Jan 19th to the $2.53 low two Fridays ago.

• The surge in crude oil, the disasters in Japan have all taken a toll on the airline related sector.

• We would upgrade the stock from Neutral to BUY.

(We have all along preferred SIA Engineering, a former sister company within the SIA Group.)

• Based on the 13 cents dividend paid in respect of ye Mar 2010, yield is 5.1%. Net profit rose 4% in the 9 months to Dec ’10, putting stock on 15x trailing PE.

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