SINGAPORE, July 31 — Singapore Airlines Ltd, Asia’s second-biggest carrier by market value, dropped the most in 10 months in the city on concerns that ticket prices may be under more pressure amid growing competition.

Singapore Air fell as much as 3.2 per cent, the biggest intraday decline since October 1, to S$10.26 and traded at S$10.29 as of 9:38 a.m. The stock was the worst performer among 30 companies in the Straits Times Index today.

Aggressive fares and capacity injections from competitors will continue to pressure yields, a measure of ticket prices, the company said yesterday. Singapore Air’s first-quarter profit dropped 71 per cent because of lower fares and bigger losses from affiliates including Tiger Airways Holdings Ltd.

“The guidance suggests a challenging passenger yield environment, especially given continued competition from the Middle Eastern airlines,” HSBC Holdings Plc said in a report today, downgrading Singapore Air’s stock to neutral, or hold, from overweight, or buy. “Until SIA can start to show a sustainable earnings recovery, we believe there are limited near-term share price drivers.”

Net income in the three months ended June fell to S$34.8 million ($28 million) from S$121.8 million a year earlier, the airline reported yesterday. Sales dropped 4.1 per cent to S$3.68 billion. — Bloomberg