BOC AVIATION(HK:02588) GF SECURITIES·2024-07-10 09:01Investment Rating - The report assigns a "Buy" rating to the company, with a target price of 78 HKD per share, compared to the current price of 56.50 HKD [7]. Core Insights - The company reported significant improvement in operational data, particularly in aircraft sales, which is expected to drive revenue growth in the first half of 2024 [2][3]. - The average age of the company's owned fleet increased to 4.9 years as of Q2 2024, up from 4.6 years in 2023, indicating a potential increase in sales of older assets [3]. - The delivery of aircraft has been negatively impacted, with Boeing and Airbus delivering 131 and 256 aircraft respectively from January to May 2024, compared to 206 and 244 in the same period of 2023 [4]. - The decline in delivery levels is expected to support continued growth in rental income [4]. - The company benefits from a decrease in interest costs due to lower U.S. Treasury yields, which may enhance profit margins [5]. - Profit forecasts indicate a net profit of 840 million USD for 2024 and 885 million USD for 2025, with core net profit expected to grow significantly in a declining interest rate environment [5]. Summary by Sections Operational Performance - The company delivered a total of 18 aircraft and sold 15 in the first half of 2024, compared to 16 deliveries and 3 sales in the same period last year [2]. - Increased aircraft sales are anticipated to contribute to revenue growth in the first half of 2024 [3]. Delivery and Rental Income - The overall delivery levels of Boeing and Airbus have decreased, which is expected to positively impact rental income due to supply constraints [4]. Financial Projections - The company is projected to achieve revenues of 2,307 million USD in 2024, with a growth rate of 9.90% [6]. - The net profit is expected to grow at a rate of 9.95% in 2024, reaching 840 million USD [6].