HVS - ASIA PACIFIC HOSPITALITY NEWSLETTER - For The Week Ending 6 February 2015 (February 13, 2015)

Oil prices on air tickets

According to the International Air Transport Association (IATA), jet fuel prices have declined by 47.1% in the past year globally and 47.6% in Asia and Oceania. In the short-term, analysts believe that changes in oil prices would benefit Chinese and budget airlines that have historically not participated in hedging strategies actively, adopting spot pricing. Legacy carriers, like Cathay Pacific Airways Ltd (2015 Hedge exposure: 57%) and Singapore Airlines Ltd (Ending March 2015 Hedge exposure: 65%), on the other hand may have to see through their existing hedging contracts before reaping present day benefits. Falling oil prices have resulted in several airlines removing fuel surcharges, which will stand to benefit tourism around the region.

Myanmar Improves Connectivity

Myanmar’s tourism continues to gain limelight with the improvements in air connectivity by two domestic airlines. Air KBZ, a domestic carrier of Myanmar Airlines International (MAI), has plans to expand its routes into second tier cities, whilst MAI continues to serve primary cities. Air KBZ will open new routes to Thailand with Chiang Mai and Mae Sot, a city located near the Burmese border. Myanmar will also improve domestic connectivity with the new Apex Airlines, which will begin operations in March 2015. The carrier will be based in Nay Pyi Taw, and connect to Yangon, Sittwe, Dawei, Myeik and Kaw Thoung. In order to benefit from these improvements, Burmese airlines may have to establish transparent aviation legislation and policies governing the practices of these airlines, in light of the recent spate of aviation misfortune within the region.

Patina Enters Maldives

Patina plans on establishing its name in the Maldives with a 70-villa luxury property scheduled to open in 2017. Patina would be located on Thanburudhoo Island, 20mins north of Malé by speedboat. The company aims on entering the market relying on its location, being strategically situated within close proximities of some of the nation’s most renowned surf spots – Sultans and Honkeys. One of the greatest barriers to entries for hotel companies in the Maldives has been the accessibility from the airport to the respective resort islands. Hence, being located within close distances from the international airport as well as surfing spots will definitely offer Patina an added advantage.

Absolute Share Price Performance, as on 6 February 2015

Closing Share Price as at6 Feb 201530 Jan 2015% Change
Australia Stock Exchange (ASX)
Amalgamated Holdings Limited11.9111.761%
General Property Group4.714.524%
Mirvac Group2.051.946%
Mantra Group3.032.6614%
Bangkok Stock Exchange (THB)
Central Plaza Hotel Public Co Ltd32.5034.00-4%
Dusit Thani Public Co Ltd58.7558.001%
The Erawan Group Public Co Ltd4.984.843%
Grande Asset Hotels and Property Public Co Ltd2.182.142%
Laguna Resorts & Hotel Public Co Ltd30.7529.504%
Minor International Public Co Ltd33.7536.00-6%
China Shanghai Stock Exchange (RMB)
Jinling Hotel Corporation Ltd12.0512.62-5%
China Shenzhen Stock Exchange (RMB)
Huatian Hotel Group Co Ltd6.016.26-4%
Guangzhou Dong Fang Hotel Co Ltd12.6712.66-
China Lodging Group Ltd22.1921.513%
Home Inns & Hotels Management Inc27.0924.4311%
Hong Kong Stock Exchange (HK$)
Miramar Hotel & Investment Co Ltd9.819.81-
Regal Hotels International Holdings Ltd4.684.81-3%
Sino Hotels Holdings Ltd2.502.50-
The Hong Kong & Shanghai Hotels Ltd11.2011.101%
Shangri-La Asia Limited10.3210.003%
Dorsett Hospitality International1.271.28-1%
National Stock Exchange (INR)
IHCL (Taj Hotels, Resorts & Palaces)118.20120.50-2%
EIH (Oberoi Hotels & Resorts)107.45114.00-6%
Hotel Leela Ventures21.7522.50-3%
Korea Exchange (KRW)
The Shilla101,500104,000-2%
Singapore Stock Exchange (S$)
Amara Holdings Ltd0.540.532%
Ascendas Hospitality Trust0.6950.6851%
Ascott Residence Trust1.2651.26-
Banyan Tree Holdings Limited0.560.5257%
CDL Hospitality Trusts1.751.81-3%
Far East Hospitality Trust0.850.8451%
Hotel Grand Central Ltd1.341.322%
Hotel Properties Ltd4.054.12-2%
Mandarin Oriental International Ltd (US$)1.6751.633%
OUE Hospitality Trust0.9150.92-1%
Stamford Land Corporation Ltd0.5550.565-2%
Taiwan Stock Exchange (NT$)
Formosa International Hotels Corporation325.00320.002%
The Ambassador Hotel, Ltd28.0028.10-
Tokyo Stock Exchange (JPY)
Japan Hotel REIT Investment Corp.79,20077,8002%
Imperial Hotel, Ltd2,5112,570-2%

Disclaimer: Information provided above has been gathered from various market sources. HVS has not independently verified the accuracy of the information provided. Interested parties should not rely on the information as statement of facts and are advised to make their own independent checks to verify the information provided. For further information, please feel free to contact HVS Asia Pacific.

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