[Click eStock] "Jin Air to Continue Performance Improvement in the Second Half"

Daishin Securities Report

Daishin Securities evaluated on the 23rd that Jin Air is expected to continue its performance improvement trend in the second quarter and the second half of the year. The investment opinion of Buy and the target price of 25,000 KRW were maintained.

In the first quarter, Jin Air recorded an operating profit of 84.9 billion KRW, achieving its best-ever performance. The recovery of passenger demand centered on Southeast Asia and Japan, along with a break-even load factor (L/F) of 89.1%, had a positive impact. Ji-hwan Yang, a researcher at Daishin Securities, said, “Among the three LCCs, Jin Air achieved the highest operating profit margin and operating profit, proving the operational efficiency of four B777 aircraft.”

The second quarter performance is expected to record sales of 298.5 billion KRW and operating profit of 29.6 billion KRW. Annual performance is predicted to reach sales of 1.2935 trillion KRW and operating profit of 202.7 billion KRW, representing 118% growth and a return to profitability compared to the previous year. Researcher Yang analyzed, “The second quarter is traditionally a seasonal off-season, so the scale of profit and profitability will decline compared to the first quarter. Nevertheless, Jin Air will show a different profit level than in the past.”

The company plans to expand supply to more than 100% of 2019 levels in the second half of this year, and about 93% on an annual basis. Additionally, two B737 aircraft will be introduced to expand supply.

Considering this, the current stock price level is estimated to be undervalued. Researcher Ji-hwan Yang analyzed, “Concerns about productivity decline due to supply expansion by LCCs and passing the profit peak seem to be reflected in the stock price. Even after reflecting these factors, Jin Air is undervalued.”

This content was produced with the assistance of AI translation services.