China Express(002928) ZHONGTAI SECURITIES·2024-08-31 03:02Investment Rating - The investment rating for the company is "Buy" (maintained) [1] Core Views - The company achieved a turnaround in H1 2024, reporting a net profit attributable to shareholders of 0.26 billion RMB, compared to a net loss of 1.97 billion RMB in the same period of 2023 [1] - The company benefited from increased demand for private travel and government subsidy policies, which positively impacted its financial performance [1][3] - The company is positioned as the only large-scale independent regional airline in China, with significant growth potential supported by favorable policies [1] Financial Performance Summary - Revenue Forecasts: - 2022A: 2,643 million RMB - 2023A: 5,151 million RMB (yoy growth: 95%) - 2024E: 7,790 million RMB (yoy growth: 51%) - 2025E: 9,095 million RMB (yoy growth: 17%) - 2026E: 9,667 million RMB (yoy growth: 6%) [1][3] - Net Profit Forecasts: - 2022A: -1,974 million RMB - 2023A: -965 million RMB (yoy growth: 51%) - 2024E: 406 million RMB (yoy growth: 142%) - 2025E: 952 million RMB (yoy growth: 134%) - 2026E: 1,124 million RMB (yoy growth: 18%) [1][3] - Earnings Per Share (EPS): - 2023: -0.75 RMB - 2024E: 0.32 RMB - 2025E: 0.74 RMB - 2026E: 0.88 RMB [1][3] - Return on Equity (ROE): - 2023: -31.3% - 2024E: 11.6% - 2025E: 21.4% - 2026E: 20.2% [3] Operational Highlights - The company increased its fleet size, adding 23 aircraft in H1 2024, which contributed to improved operational performance [1] - The company capitalized on market demand for regional travel, enhancing flight quality and accessibility to regional cities [1] - Government subsidies and recovery from bad debts contributed to the company's financial recovery [1][3]