Minsheng Securities·2025-09-02 01:06Investment Rating - The report maintains a "Recommended" rating for China National Airlines (601111.SH) [4][6] Core Views - The company reported a revenue of 80.8 billion yuan for H1 2025, a year-on-year increase of 1.6%, with a net loss attributable to shareholders of 1.81 billion yuan, an improvement from a loss of 2.78 billion yuan in H1 2024 [1] - The decline in oil prices has alleviated the pressure from rising costs, contributing to a better profit performance despite a challenging pricing environment in domestic routes [1][2] - The company is actively adjusting its pricing strategy in response to market conditions, leading to a year-on-year decrease of 6.2% in domestic passenger kilometer revenue [2] - Financial expenses have improved due to a reduction in dollar-denominated debt and a decrease in interest expenses, with a 27% year-on-year decline in financial costs [3] Financial Forecasts - The projected revenue for 2025 is 179.3 billion yuan, with a growth rate of 7.6% [5][11] - The net profit attributable to shareholders is expected to be 1.04 billion yuan in 2025, a significant increase from a loss of 237 million yuan in 2024 [5][11] - The earnings per share (EPS) is forecasted to be 0.06 yuan for 2025, with a price-to-earnings (PE) ratio of 125 [5][11] Additional Insights - The company plans to increase its investment in Shenzhen Airlines to address its financial difficulties, which is expected to enhance operational capabilities and improve the overall competitiveness of the airline network [3] - The report anticipates a recovery in industry pricing, although it has adjusted the net profit forecast for 2025 to 1.04 billion yuan due to subdued pricing data during the peak summer season [4]