- We reiterate our OUTPERFORM rating for SCS despite raising our target price (TP) by 17% as the share price has increased by 20% during the last three months.

- Our higher TP is due to (1) rolling our TP horizon forward to mid-2025, (2) respective 9%/7% higher 2024/25F total throughput due to strong 4M 2024 results, (3) valuation contribution from LTA cargo terminal No. 1 (LTA1) as we factor in SCS’s potential 20% stake in this project, all outweighing our -3% YoY 2024F blended ASP projection (vs +12% YoY previously) due to our lower international cargo ASP expectation and price discounts for Qatar Airways.

- We forecast international volume (~90% of SCS’s total throughput) to increase 50%/12%/8% YoY in 2024F/25F/26F before falling 22% YoY in 2027F when LTA1 comes online.

- Despite initial cannibalization of SGN by LTA1, we project SCS's 20% stake in the terminal to enhance its long-term earnings, contributing around 25% of its NPAT-MI during 2029-33F.

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