JUNEYAOAIR(SH:603885) Guotai Junan Securities·2024-08-22 03:11Investment Rating - The investment rating for the company is "Buy" [5] Core Views - The company is experiencing a significant recovery in profitability, with its performance in the first half of 2024 showing a year-on-year increase of over five times in net profit attributable to shareholders, reaching 490 million yuan, which is an 84% recovery compared to the same period in 2019 [10] - The impact of engine maintenance on fleet turnover and profitability is limited, with aircraft utilization rates exceeding those of 2019 [10] - The company is expected to benefit from a recovery in industry supply and demand, with its high-quality flight network anticipated to show an upward trend in profitability [10] Financial Summary - The target price is set at 22.00 yuan, unchanged from the previous forecast [5] - The company's total revenue for 2024 is projected to be 23,051 million yuan, reflecting a 14.7% increase from 2023 [11] - The net profit for 2024 is forecasted at 1,404 million yuan, an increase of 86.9% compared to 2023 [11] - The company’s earnings per share (EPS) is expected to rise to 0.63 yuan in 2024, up from 0.34 yuan in 2023 [11] - The net asset return rate (ROE) is projected to improve to 15.6% in 2024, compared to 8.9% in 2023 [11] Operational Insights - The company has expanded its fleet size by 34% and revenue passenger kilometers (RPK) by 36% compared to 2019, with operating revenue increasing by 36% [10] - The introduction of new fuel-efficient aircraft has led to a 10% reduction in fuel consumption per seat kilometer, partially offsetting the impact of high oil prices [10] - The company is focusing on optimizing its flight network and enhancing the value of its flight slots, which is expected to drive future profitability [10]