Investment Rating - The report recommends a "Buy" rating for the aviation sector, highlighting strong supply logic and elastic demand, with specific recommendations for several airlines and global aircraft leasing companies [4][104][105]. Core Insights - The global aviation market is experiencing steady recovery, with passenger turnover (RPK) increasing by 4.8% year-on-year in the first three quarters of 2025, driven by international routes [4][7]. - The report emphasizes the ongoing constraints in the aircraft manufacturing supply chain, predicting that the trend of aging aircraft will continue for the next 5-10 years, leading to significant supply limitations [4][104]. - Airlines are expected to see substantial improvements in profitability as they approach a pivotal moment in the industry, with a notable increase in international passenger traffic anticipated [4][104]. Summary by Sections Global Aviation Market Overview - The global aviation market is stabilizing, with RPK growth of 4.8% and ASK growth of 4.7% in the first three quarters of 2025, resulting in an overall passenger load factor increase to 83.5% [4][7]. - The Asia-Pacific region leads in RPK growth at 7.7%, while North America shows minimal growth [4][13]. U.S. Aviation Market Tracking - In Q3 2025, U.S. airline ticket sales saw a rebound with domestic passenger volume up by 7.4% and average ticket prices increasing by 4.1% [4][43]. - The report notes a divergence in performance among major U.S. airlines, with Delta Airlines showing significant profit growth while American Airlines reported losses [4][61][69]. European Aviation Market Tracking - The European aviation market has shown steady recovery, with passenger volumes returning to pre-pandemic levels and ticket prices experiencing slight increases [4][74][83]. - Lufthansa reported a 4% increase in revenue for Q3 2025, driven by strong demand for leisure travel [4][83]. Asian Aviation Market Tracking - Major airports in Southeast Asia and Japan are experiencing continued growth, with passenger volumes surpassing pre-pandemic levels [4][88][94]. - The report highlights the strong recovery in passenger traffic at key transit airports, benefiting from robust demand [4][94]. Investment Analysis - The report suggests that the aviation sector is at a turning point, with airlines likely to experience a "golden era" of profitability due to increasing international travel and effective capacity management [4][104]. - Specific airline recommendations include China Eastern Airlines, China Southern Airlines, and Spring Airlines, among others, with a focus on companies showing continuous improvement in performance [4][104][105].