华泰证券:出行链淡季显韧性 看好3Q航司盈利表现

Huatai Securities: The travel chain shows resilience in the off-season and is optimistic about the profit performance of 3Q airlines

Zhitong Finance ·  09/14/2023 15:11

The Zhitong Finance App learned that Huatai Securities released a research report saying that the overall transportation sector outperformed the market in August, with airlines/airports falling 8.5%/16.3%.Mainly hampered by lower expectations for duty-free consumption and rumors of poor deduction rates; Logistics fell 8.6%, mainly due to insufficient consumer confidence, which dragged down sector performance; shipping fell 6.8%, mainly due to low off-season freight rates; highways/railways/ports fell 4.7%/5.0%/6.5%, mainly supported by safe-haven properties. Optimistic about the resilience of civil aviation demand, the implementation of pre-sale data for the “11th” holiday is expected to boost sector performance; the 3Q23 profit level of the highway sector is expected to improve month-on-month; express delivery competition continues but leading individual stocks report performance and steady monthly volume performance; oil transport/dry shipping is driven by demand during the peak season in the second half of the year, and freight rates are expected to improve month-on-month from the current low base.

▍ The main views of Huatai Securities are as follows:

Aviation airport: Airline is still looking forward to off-season aviation, optimistic about 3Q airline profit performance

In late August, the peak summer travel season came to an end, and high-frequency data declined somewhat, causing the aviation sector to record greater fluctuations compared to the market. However, the net profit of airlines has improved season by season. Air China, China Eastern Airlines, China Southern Airlines, Chunqiu, Jixiang, and Huaxia collectively had a net loss of 4.04 billion yuan in 2Q23, a loss of 4.34 billion yuan over the previous month. Moreover, after deducting exchange gains and losses, most of the net profit was profitable. 3Q23 is expected to turn profitable. At the same time, demand for civil aviation is resilient. “Eleventh” Golden Week will be the next verification window. Although September is a low season for aviation, along with the gradual implementation of data such as pre-sales, etc., it may increase the predictability of the increase in airline profit centers.

On the airport side, the pace of resumption of international routes is expected to improve marginally, but considering the pace of resumption of duty-free consumption and uncertainty about airport channel bargaining rights in the duty-free industry chain, it is still necessary to wait for airport profits to return to 2019 levels.

Shipping ports: Oil/dry bulk freight rates are expected to rise month-on-month, and demand for consolidation/ports is weak

Oil freight rates continued to decline in August. Shipping companies jointly controlled effective capacity to drive up freight rates, and dry bulk freight rates were still low. Outlook for September:

1) Oil transportation: Although current domestic demand remains to be seen, freight rates are expected to rise month-on-month from the current low base as we enter the seasonal peak season. The pattern of medium- to long-term oil supply being tightened and demand steady has not changed. Basically, the orientation is positive. 2) Dry dispersion: The second half of the year is driven by a rise in seasonal demand, and freight rates are expected to improve slightly month-on-month. 3) Consolidated shipping: US freight rates are expected to remain stable, but European freight rates may decline month-on-month. 4) Ports: The impact of the low base figure in August was eliminated, and the year-on-year growth rate of throughput may decline.

Highways and railways: Market risk appetite is rising, and high dividends are relatively profitable or not superior

Recently, the “steady growth” policy has raised market risk appetite. At the same time, it may be difficult to break through the historical bottom of 2.5% of 10-year treasury bonds (Huatai Fixed Income Group “Recent Concerns in the Bond Market May Be Greater Than Long-Term Concerns” 2023-9-3). Highways and railways have the characteristics of high dividends, and debt has been prominent since the beginning of the year. From the perspective of risk-free interest rates and risk appetite, the sector's relative earnings may not be superior recently. As far as fundamentals are concerned, the degree of recovery of highway buses during the summer season was significantly better than in the first half of the year; under the impetus of the inventory cycle and the “steady growth” policy, trucks also gradually broke out of the trough period in the first half of the year;

Overall, the Q3 profit level of the highway sector is expected to improve month-on-month. Railway passenger traffic in summer is the same trend as highway passenger traffic. High-speed rail is expected to record strong profits in Q3; railway freight during the peak season is not prosperous, mainly impacted by imported coal, and Q3 profits are likely to be relatively lackluster.

Logistics Express: Express delivery competition continues, and bulk supply chain demand is expected to recover

As we enter the peak season for the express delivery industry in the second half of the year, there was an upward trend in the growth rate of the national express delivery industry in July-August, but prices continued to decline year on year. The express delivery industry has entered a stock game period. Leading companies are hungry for share, and express delivery price competition may continue, but express delivery companies with stable express delivery networks, improved management efficiency, and extensive use of automated equipment have room for backup amounts to rise and costs to decline, and are expected to maintain a double increase in revenue scale and profitability in industry competition.

Among other logistics sectors, they are optimistic about the high barriers and high gross profit attributes of hazardous chemical logistics. Leaders expand assets and business scale through mergers and acquisitions, increase market share, and achieve a continuous increase in profits; the boom in the bulk supply chain sector is expected to recover, and medium- to long-term industry concentration will increase, bringing opportunities for individual stocks to double profit and valuation.

Risk warning:

Economic growth is slowing, trade friction, oil remittance risks, and competition is worsening.

Disclaimer: This content is for informational and educational purposes only and does not constitute a recommendation or endorsement of any specific investment or investment strategy. Read more
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