Heungkuk Securities has offered a new target price of 25,000 won and an investment opinion "buy" for Jeju Air, saying it is a beneficiary of With Corona.
Heungkuk Securities analyzed, "We recorded sales of 68.2 billion won, operating profit of -91.3 billion won in the third quarter of this year, and domestic sales of 53 billion won.".
"We aggressively expanded our supply in consideration of the domestic peak season, but sales per unit fell due to a four-stage upgrade to Jeju Island during the holiday period," Heungkuk Securities said. "International ship sales recorded 3.8 billion won and nothing unusual compared to the previous quarter.".
"We expect 83.7 billion won in sales in the fourth quarter, -72.3 billion won in operating profit, 863.3 billion won in sales and-117.9 billion won in operating profit next year," Heungkuk Securities said. "With Corona, domestic sales will gradually stabilize as demand for travel to Jeju Island gradually expands.".
"Considering the current recovery of international flights centered on the U.S. and European routes, improvement in profits in the international sector is expected to take more time and overseas travel will recover from the first quarter of next year, and the passenger market will be normalized in 2023," Heungkuk Securities predicted.
Heungkuk Securities said, "The earnings recovery is expected to be most noticeable in that it has the largest number of aircraft among domestic LCCs (low-cost carriers)," adding, "The payment of 206.6 billion won in shareholder allocation paid-in capital increase was completed in October, resolving uncertainties over issues of lack of liquidity and capital erosion and secured funds to operate until the recovery of international passengers next year.".
Reporter Lee Dong-hoon usinvestmentidea2020@gmail.com
