Minsheng Securities·2025-09-03 03:48Investment Rating - The report maintains a "Recommended" rating for China Eastern Airlines (600115.SH) [4][6] Core Views - The company reported a revenue of 66.8 billion yuan for the first half of 2025, a year-on-year increase of 4.1%, with a reduced net loss of 1.43 billion yuan compared to a loss of 2.77 billion yuan in the first half of 2024 [1] - The company is focusing on cost control and optimizing its capital and debt structure, which has led to a significant reduction in losses [2][3] - The international route capacity has reached 118% of the same period in 2019, indicating a strategic shift towards enhancing its international network [3] Summary by Sections Financial Performance - In Q2 2025, the company achieved a revenue of 33.4 billion yuan, a year-on-year increase of 7.8%, with a net loss of 440 million yuan, significantly improved from a loss of 1.97 billion yuan in Q2 2024 [1][2] - The overall seat revenue decreased by 3.1% year-on-year, with domestic routes down by 4.4% and international routes up by 0.5% [2] - The company has effectively controlled costs, with a 2.4% increase in unit fuel costs but a 3.9% decrease in total unit costs due to falling oil prices [2] Strategic Initiatives - The company is enhancing its position as an international hub in Shanghai and expanding its international route network, which is expected to contribute positively to profitability [3] - Adjustments to the aircraft fleet plan have been made, reducing the number of aircraft to be introduced in 2026 and 2027, focusing on optimizing existing operations [3] Future Outlook - The report projects a net loss of 1.07 billion yuan for 2025, with a recovery expected in 2026 and 2027, forecasting net profits of 3.47 billion yuan and 5.18 billion yuan respectively [4][5] - The current stock price corresponds to a price-to-earnings ratio of 26 times for 2026 and 17 times for 2027 [4][5]