On May 6th, aviation stocks showed bullishness all at once, despite the inferior situation where the stock index in South Korea fell by more than 1%. With the news that the Kimpo Airport-Haneda air route will resume at the latest early June, there is an analysis that interest in related beneficiary makers is needed as the full-scale travel season approaches.
According to Market Point on May 8th, Korean Air's stock price on 6th was 30,500 won (about US$29), up 2.18% from the previous business day, and Air Busan was up 2% to 2,295 won (about $21). The transaction was closed in yen). Asiana Airlines closed at 19,800 won (about $18), which is 1.02% higher, and T'way Holdings closed at 806 won (about 78 cents), which is 1% higher.
In addition, AK Holdings, Jeju Air and Jin Air all rose by nearly 1%. Considering that the KOSPI and KOSDAQ indexes fell by more than 1% on that day, the stock prices of these aviation industries had a good fight. In particular, LCCs (low-cost carriers) are attracting attention because of the expectation that air routes between Japan and South Korea will resume from next month.
“Recently, expectations are rising that Japan's routes will resume in June,” said Ji Ine, a researcher at Shin-Korea Financial Investment. This is because he positively mentioned the resumption of Japan-Korea routes and the restoration of visa exemption in the media interview when he returned after his visit to Japan."
The Gimpo-Haneda flight, which was actually suspended from March 2020, is scheduled to resume from the beginning of next month at the latest. A Japanese-Korean diplomatic source said on this day that "an agreement has been reached (between the Japanese and Korean authorities) by resuming air flights between Gimpo and Haneda from the beginning of June," and "the resumption time may be advanced." Clarified. Therefore, major Korean and Japanese airlines such as Korean Air, Asiana Airlines, Japan Airlines (JAL), and All Nippon Airways (ANA) are also applying to resume operations on the Gimpo-Haneda route.
As a result, LCC's performance is expected to be positive as well. Researcher Ji said, "Looking at LCCs, the sales weight of short-distance routes to Japan is overwhelming." T'way Air, Jin Air, and Jeju Air have the highest sales weight on Japanese routes in that order."
Air Busan recorded sales of 633.2 billion won (about $629 millions) and operating loss of 37.8 billion won (about $35 millions) in 2019 before the COVID-19 shock. Sales in Japan dropped sharply for the second consecutive year until 2021, and last year's standard sales amounted to 176.5 billion won (about $173 millions), which is less than half of 2019. A big recovery trend can be expected when the trip is resumed.
According to financial information company F & Guide, T'way Air, Jin Air and Jeju Air, excluding Air Busan, have estimated average sales growth of 149.62% this year. Jeju Air is expected to grow the highest at 189.2%, and all three companies are expected to continue their operating deficits until this year.
Meanwhile, the Japanese government began considering accepting foreign tourists from June, the Nikkei, one of Japanese economics paper, reported on that day. Recently, as the yen depreciates, we can see the intention to focus on improving the balance of payments through foreign tourists. According to the Bank of Korea's economic statistics system, the yen exchange rate against the won, which has been below the 1,000 won level since March 25th, is currently in the 968.94 won range.
Published : 2022/05/14 09:27 KST
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