Core Viewpoint - China Southern Airlines' Shantou Airlines is enhancing its flight services and route network in response to the upcoming summer travel season, aiming to provide a more comfortable and enjoyable travel experience for passengers [1][4]. Group 1: Route Network Upgrade - The airline plans to deploy 28 aircraft at Jieyang Chaoshan International Airport, covering 37 direct domestic cities, with new routes to Xining and Sanya starting in early July [2]. - Popular routes from Chaoshan to major cities such as Shanghai, Hangzhou, and Guangzhou will see increased flight frequencies, with over 40 daily departures [2]. - International travel options are expanded with new routes available via Guangzhou and Beijing to destinations like Tashkent and Almaty [2]. Group 2: Ticket Pricing and Promotions - Significant discounts on ticket prices are offered for popular tourist destinations, with prices starting from 310 CNY for Chaoshan to Changsha and up to 500 CNY for Chaoshan to Beijing [3]. - Additional family travel discounts and promotional offers are available through the airline's official channels [3]. Group 3: Enhanced Travel Experience - The "Fun Summer" theme will be integrated into the travel experience from July 1 to September 10, featuring special activities for students and families [4]. - Unique in-flight experiences and ground services, such as dedicated check-in counters and themed flights, will be provided to enhance passenger enjoyment [4]. - A photography contest will encourage travelers to share their experiences, with opportunities to win creative gifts from the airline [4].

Investment Rating - The report rates the transportation industry as "Outperform" [2] Core Insights - The easing of tensions in the Middle East has led to a decline in oil tanker rates, with the VLCC market experiencing a significant price drop of 14.31% compared to June 19, with current rates at WS59.88 [3][12] - In the shipping sector, the demand for European routes has improved, resulting in a 10.6% increase in spot market booking prices, while the US routes have seen a decline of 7.0% and 11.9% for the West and East coasts, respectively [3][14] - During the summer travel season, Hainan Airlines plans to operate nearly 2,500 flights daily, with domestic ticket bookings reaching 17.9 million, a 5% increase year-on-year [3][15] - The newly unveiled Zhuque eVTOL has a range of 600 kilometers, and from January to May, national railway freight volume increased by 3.1% year-on-year, totaling 1.641 billion tons [3][22] Summary by Sections 1. Industry Hot Events - The Middle East situation has calmed, leading to a reduction in oil tanker rates and a return to supply-demand fundamentals [12] - Hainan Airlines is set to launch 75 new domestic and international routes during the summer travel season, with a daily flight plan of nearly 2,500 [15] - The Zhuque eVTOL was showcased, achieving a range of 600 kilometers, while railway freight volume showed a year-on-year increase [22] 2. High-Frequency Data Tracking - Air logistics: The overall trend for routes to the Asia-Pacific remains stable, with air freight prices showing a decline [25] - Shipping ports: The domestic container shipping price index has decreased, while dry bulk freight rates have also fallen [43] - Express logistics: In May 2025, express delivery volume increased by 17.20% year-on-year, with revenue rising by 8.20% [54] - Air travel: The average daily international flights in the last week of June 2025 increased by 17.51% year-on-year [3] - Road and rail: The number of freight trucks on highways increased by 0.88% week-on-week [3] 3. Investment Recommendations - Focus on the equipment and manufacturing export chain, recommending companies like COSCO Shipping, China Merchants Energy Shipping, and Huamao Logistics [4] - Attention to low-altitude economy investment opportunities, recommending CITIC Offshore Helicopter [4] - Investment opportunities in the road and rail sector, recommending Sichuan Chengyu, Gansu Expressway, and others [4] - Interest in cruise and ferry investment opportunities, recommending Bohai Ferry and Haixia Co [4] - E-commerce and express delivery investment opportunities, recommending SF Express, Jitu Express, and Yunda [4] - Investment opportunities in the aviation sector, recommending China National Aviation, Southern Airlines, and others [4]

Core Insights - The 2025 summer transportation period will last from July 1 to August 31, totaling 62 days, with airlines actively preparing by increasing capacity and deploying multiple C919 aircraft to meet demand [1] - The number of available flights during the summer transportation period is expected to increase by approximately 7.3% year-on-year, with a projected total of 1.9597 million flights, although actual passenger flights are expected to grow by about 2.3% due to weather and cancellations [1] Group 1: Airline Operations - China Southern Airlines plans to operate over 3200 flights daily across 970 domestic and 260 international routes, with 5 C919 aircraft deployed on 13 routes [2] - China Eastern Airlines aims to execute over 1150 passenger routes with more than 3200 daily flights, including 11 C919 aircraft in commercial operation [2] - Hainan Airlines expects to operate approximately 53,000 flights, transporting nearly 9.06 million passengers, with a significant increase in international flights [3] Group 2: Route Adjustments - Airlines are strategically adjusting their route offerings, with China Southern Airlines opening new routes to popular tourist destinations and increasing flight frequencies [4] - 吉祥航空 is adding multiple cool destination routes and increasing flights to Japan and South Korea by over 19% [4] - Hainan Airlines is adjusting capacity based on passenger demand, focusing on popular international destinations as travel restrictions ease [5] Group 3: Market Trends - The expansion of China's visa-free travel and improved payment facilitation for foreigners is expected to boost inbound tourism, with cities like Manchester and Tokyo becoming popular destinations [5] - The international route structure is anticipated to continue evolving due to changes in international trade and tourism, with emerging markets becoming focal points for new route development [5]

Core Viewpoint - The summer travel season is approaching, with airlines increasing capacity and launching new routes, particularly to the northwest and northeast regions of China, leading to a decrease in ticket prices for flights from Beijing to Xinjiang [1][3][5]. Group 1: Airline Capacity and Route Expansion - Multiple airlines, including China Southern Airlines and Hainan Airlines, are enhancing flight capacity to popular destinations in the northwest, such as Xinjiang, Inner Mongolia, and Qinghai, with new routes and increased flight frequencies [3][7]. - China Southern Airlines plans to operate over 2,300 flights weekly from Beijing Daxing, with new routes to Changbai Mountain, Xining, and other tourist destinations [3]. - The planned flight volume to Xinjiang during the summer travel period is expected to increase by over 20% year-on-year, with significant growth in smaller airports in the region [3]. Group 2: Ticket Price Trends - Ticket prices for direct flights from Beijing to various destinations in Xinjiang have decreased, with prices for flights dropping by over 1,000 yuan for some routes compared to two weeks prior [1][5]. - As of June 30, the lowest prices for flights from Beijing to Urumqi, Alatai, and Hami were reported at 2,430 yuan, 1,930 yuan, and 2,577 yuan, respectively, reflecting significant price reductions [5][6]. - The average ticket price for summer travel has decreased by 1.3% year-on-year, attributed to high pre-sale prices in 2024 and increased demand [6]. Group 3: Enhanced Passenger Services - Airlines are introducing targeted passenger services for the summer season, including expanded pet transport services and dedicated charter services for students [1][7]. - China Eastern Airlines has upgraded its "pet in cabin" service, adding 16 new routes, while Hainan Airlines is focusing on services for students and unaccompanied minors [7].

Group 1 - The upcoming summer peak season for civil aviation in 2025 is prompting multiple airlines to launch new routes and explore diversified markets, indicating a focus on enhancing market consumption potential [1] - According to Minsheng Securities, domestic airline prices have improved since the beginning of the year, with off-season demand showing support, and strong performance in holiday air traffic likely to carry over into the summer peak season [1] - Airbus's 2024 GMF report predicts a long-term global air passenger traffic compound annual growth rate of 3.6%, with significant growth in per capita flight frequency, particularly in China, where it is expected to rise from 0.6 times in 2024 to 1.8 times by 2044 [1] Group 2 - Cathay Haitong Securities reports a slight increase in fleet size in the first half of 2025, with limited room for improvement in fleet turnover during the summer peak, and domestic operational investment expected to show minimal growth [2] - The demand for family travel during the summer peak is anticipated to remain strong, with optimistic supply-demand expectations, and a slight adjustment in ticket prices by some airlines to ensure good pre-sale progress for the summer season [2] - With a low base for ticket prices in the summer of 2024, a year-on-year increase in ticket prices for the summer of 2025 is expected, potentially leading to record profits for airlines [2] Group 3 - The aviation sector is entering a low growth supply era, with demand showing resilience since April, and the next two years expected to see continued improvement in supply-demand dynamics [2] - The aviation market is steadily approaching the peak season, with limited growth in supply and a natural increase in passenger volume, supporting the logic of rising airline revenues if domestic ticket prices recover [2] - Shenwan Hongyuan Securities continues to recommend focusing on the aviation sector, highlighting strong certainty in supply slowdown and elastic demand, which, combined with favorable oil and exchange rate conditions, could significantly enhance airline performance [2] Group 4 - Related Hong Kong stocks in the aviation sector include China Southern Airlines (600029)(01055), Air China (601111)(00753), China Eastern Airlines (00670), Cathay Pacific Airways (00293), BOC Aviation (02588), and China Civil Aviation Information Network (00696) [3]

Core Points - The event named "Mumian Research Study" organized by China Southern Airlines provided 130 elementary school students in Shanghai with an immersive aviation science experience, aiming to inspire their interest in aviation [1] - The program included interactive lessons on aircraft structure, flight principles, and safety knowledge, led by uniformed flight attendants, which sparked enthusiastic discussions among the students [2] - The event featured practical training in emergency response, including first aid techniques and self-rescue methods during in-flight emergencies, enhancing students' emergency preparedness [4][7] - The immersive and interactive teaching approach combined youth responsibility education with career enlightenment, showcasing the professionalism of civil aviation personnel [7] - China Southern Airlines plans to continue developing its "immersive vocational experience" brand by offering diverse activities in aviation science and red education to engage more individuals in the joy of flying [7]

Core Viewpoint - China Southern Airlines Group is actively participating in rural revitalization efforts through the "Wings Spread Rural · Taste Mountains and Rivers" product exhibition and sales event, aiming to leverage small products to stimulate large industries and support poverty alleviation and rural development [1][6]. Group 1: Event Overview - The exhibition features a combination of product promotion, cultural tourism display, tasting experiences, and live interaction, creating a fast track for rural products from farms to markets, attracting over a thousand participants including employees and partners [3]. - The event showcases over 400 products from 14 supported regions, highlighting unique local specialties such as Xinjiang's maren candy and various regional delicacies from Guangdong, Guizhou, and more [4]. Group 2: Business and Cultural Impact - The exhibition serves as a platform for cultural display and industry collaboration, featuring product introductions, cultural presentations, and stories from supported regions, effectively showcasing their natural beauty and development potential [5]. - Agreements were signed for significant procurement contracts and intentions for ongoing sales, establishing a foundation for continuous market access and brand building for rural products [5]. Group 3: Strategic Goals - China Southern Airlines aims to not only sell products but also to help rural areas build brands and expand markets, leveraging its global network and customer base to enhance the visibility and sales of rural specialties [5]. - The company has already facilitated over 1 billion yuan in sales through various channels, significantly benefiting thousands of farmers and marking a deepening of its "aviation + consumption assistance" model [5].

Group 1 - The domestic civil aviation market is experiencing a surge in travel demand as the summer travel season approaches in 2025, with airlines announcing capacity expansion plans [1][2] - There is a notable increase in outbound travel, particularly to the Schengen area in Europe, with visa application orders rising by over 10% compared to last year, marking a three-year peak [1] - Major airlines like China Eastern Airlines and China Southern Airlines are increasing flight frequencies and adding new routes to popular tourist destinations to meet high travel demand during the summer peak [2][4] Group 2 - China Eastern Airlines plans to operate over 1,150 passenger routes during the summer peak, with an average of over 3,200 flights per day, reflecting a 5% increase from the previous year [2] - China Southern Airlines aims to operate 320,000 flights across 970 domestic and over 260 international routes, with a significant increase in wide-body aircraft deployment [2][4] - The average ticket price for domestic economy class is projected to reach 869 yuan during the summer travel period, showing a 6.6% increase compared to last year's final average price [3] Group 3 - The new flight capacity is concentrated in the northwest region of China, with Xinjiang becoming a popular long-distance travel destination for tourists from central and eastern China [4] - Hotel bookings in Xinjiang have seen a significant increase, with some areas experiencing over 41% growth in hotel reservations [4] - The expansion of flight routes and increased capacity are expected to lower travel costs for consumers and stimulate spending at travel destinations [5]

Core Viewpoint - China Southern Airlines has issued A-share convertible bonds totaling 16 billion yuan, approved by the board and shareholders, to support its operational and financial needs [2][3][4]. Section 1: Bond Details - The bond issuance was approved on May 14, 2020, and the total amount authorized is up to 16 billion yuan [2]. - The company issued 160 million A-share convertible bonds at a face value of 100 yuan each, raising a total of 16 billion yuan [3]. - The bonds have a term of 6 years, from October 15, 2020, to October 14, 2026, with a tiered interest rate starting at 0.2% in the first year and reaching 2.0% in the sixth year [4][5]. Section 2: Financial Performance - For the fiscal year 2024, the company reported a total operating revenue of 174.224 billion yuan, an increase of 8.94% from the previous year [19]. - The passenger transport volume reached 164.73 million, up 15.84% year-on-year [19]. - Despite revenue growth, the company faced a net loss attributable to shareholders of 1.696 billion yuan, a significant improvement from a loss of 4.209 billion yuan in the previous year [19]. Section 3: Use of Proceeds - The net proceeds from the bond issuance, after deducting underwriting fees, amounted to approximately 15.98 billion yuan, which is allocated for aircraft purchases, spare engine acquisition, and working capital [17][19]. - The company has committed to investing 1.06 billion yuan in aircraft and maintenance projects, 60 million yuan in spare engines, and 480 million yuan in working capital, with actual investments meeting or exceeding these commitments [19][20]. Section 4: Credit Rating - The bonds have been rated AAA by the credit rating agency, indicating a strong credit quality and stable outlook for the issuer [16][18].

Core Insights - The domestic civil aviation market is experiencing a surge in travel demand as the summer travel season approaches, driven by various travel types such as summer vacations, family trips, and outbound travel [1][2] Group 1: Passenger Traffic Predictions - The domestic flight ticket bookings for July 2025 are projected to reach approximately 17.9 million, reflecting a year-on-year increase of about 5% [2] - International flight ticket bookings have exceeded 7.74 million, marking a year-on-year growth of around 14% [2] - Major domestic routes include Beijing-Shanghai, Beijing-Guangzhou, and Guangzhou-Shanghai, with significant interest in travel to Xinjiang this summer [2] Group 2: Airline Operations and Capacity - Hainan Airlines plans to operate 30,435 flights during the summer season, transporting approximately 4.59 million passengers [2] - Eastern Airlines will execute over 1,150 passenger routes with an average of more than 3,200 flights daily, representing a 5% increase compared to 2024 [2][3] - China Southern Airlines aims to operate over 320,000 flights across 970 domestic and 260 international routes, with daily flights exceeding 3,000 during peak periods [3][4] Group 3: New Routes and Seasonal Adjustments - Xiamen Airlines is launching 24 seasonal routes to popular summer destinations, including new flights from major hubs to Xinjiang and Inner Mongolia [5] - Sichuan Airlines is optimizing its domestic route network, adding and resuming over 10 routes, including direct flights from Chengdu to Hailar [5][6] - Eastern Airlines is introducing 38 new domestic routes, focusing on popular tourist regions such as Xinjiang and Inner Mongolia [7] Group 4: Market Trends and Pricing - The aviation industry is witnessing an upward trend in domestic ticket prices, with strong performance during the May Day holiday expected to carry into the summer season [8] - Analysts suggest that the improved pricing environment and strong summer demand may lead to better-than-expected profitability for the aviation sector in the second and third quarters [8]