China Aviation Oil (Singapore) Corp. Ltd. (G92.SG) has a war chest of up to $500 million to invest in oil-related infrastructure assets, which it hopes can boost profits at its core fuel trading business, the company's chief said.

The trading company's investments will be mainly in aviation fuel stations at airports and storage facilities at oil trading hubs, but may also include shipping and oil refining units, company Chief Executive Meng Fanqui said Friday.

"Only when we have the logistical advantage can we support trading," Mr. Meng said in an interview.

China Aviation Oil, the sole importer of aviation fuel into China and Asia's largest aviation fuel trader, is attempting to expand its business into other transportation fuels like diesel and marine fuel to boost profits in a low-margin business environment.

China Aviation Oil's plan to invest in logistics infrastructure to boost profits is in line with the strategies of global commodity trading majors that are expanding rapidly beyond their primary trading roles.

"We've kept our dividend at two cents for the past few years because we want to accumulate more cash and more profit for our asset investments," Mr. Meng said.

China Aviation Oil already has stakes in oil-storage facilities in China's southern Guangdong province and in South Korea, which helped prop up its net profit in the first half of this year.

Write to Eric Yep at eric.yep@wsj.com

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