An Analysis And Evaluation of Business And Financial Performance of Asean Airline Industry in 2020-2024: A Case Study of PT Garuda Indonesia and Singapore Airlines Ltd

Abstract

The airline industry is vital to the national economy by providing connectivity. Despite its crucial role, the airline industry constantly struggles to meet capital costs and maintain long-term profitability. This research analyses the business and financial performance of PT Garuda Indonesia and Singapore Airlines Ltd. as companies operating within the ASEAN airline industry from 2020 to 2024. The study utilises a comprehensive analytical framework that includes business strategy, financial analysis, and prospective analysis. A descriptive-qualitative method is applied to provide a thorough understanding of both companies' strategic responses and operational outcomes. The results of the analysis indicate that the ASEAN airline industry operates in a highly competitive environment. Further PESTLE analysis identifies macro-environmental factors shaping industry dynamics. A comparison of business performance through SWOT analysis also shows that both companies possess brand recognition strength and government support, but unhealthy financial conditions and governance issues burden Garuda Indonesia. Financial analysis underscores the extreme difficulties faced by Garuda Indonesia based on negative profit and extremely high debt-to-asset ratios. Conversely, Singapore Airlines shows consistent revenue recovery, strong cost management, and a solid capital structure. The Altman Z-Score bankruptcy prediction confirms both companies are in a zone of financial distress, but Garuda Indonesia has a higher risk of bankruptcy than Singapore Airlines. Both companies are also intrinsically undervalued, but Singapore Airlines' more stable financial position makes it a better investment choice than Garuda Indonesia.