China airlines

UOB KH has a buy rating with tp of HKD6.32. They have sell ratings on China South Air and China East Air with tp of HKD3.68 and HKD2.35 respectively.

Based on their respective preliminary earnings guidance, all three major Chinese airlines were still loss-making in 2Q23, missing their expectations of a turnaround in 2Q23. Excluding one-offs and forex losses (seen by all three airlines), CSA and Air China were closer to breakeven. Now expecting earnings to turn around in 3Q23, they cut their 2023 earnings estimates for all three airlines.