The rise in travel demand during the Spring Festival travel season is expected to continue this year. Looking ahead to the May Day holiday, it may continue to release strong travel demand.
The Zhitong Finance App learned that Galaxy Securities released a research report saying that the 2024 Spring Festival travel season recorded the “strongest Spring Festival travel season in history”. The civil aviation industry's recovery performance exceeded pre-holiday expectations, and March-April will enter the traditional dull season. The bank believes that along with further macroeconomic recovery, it is expected to drive greater certainty about the recovery in demand for public and commercial travel. At the same time, it can be seen that the 2024 Spring Festival travel season, as the first Spring Festival travel season not affected by the epidemic, has shown a strong travel trend of homecoming + travel, reflecting the rise in residents' travel demand. Therefore, the forecast expects that the rise in travel demand during the Spring Festival travel season will continue this year. Looking forward to the next May Day holiday, it may continue to release strong travel demand.
Investment advice: Continue to be optimistic about investment opportunities in relevant targets such as Air China (601111.SH), China Southern Airlines (600029.SH), Spring Airlines (601021.SH), Juneyao Airlines (), and Baiyun Airport (DAB). 603885.SH 600004.SH
Galaxy Securities's views are as follows:
2024 Spring Festival travel season: Recorded “the strongest Spring Festival travel season in history”, and the civil aviation industry's recovery performance exceeded pre-holiday expectations.
1) Passenger volume: As of the 38th day of the 2024 Spring Festival travel season, the actual number of passengers on civil aviation has reached 8.06 million, an average of 2.11 million passengers per day, +15.54% compared with the same period in 2019, which is significantly higher than the pre-holiday forecast level. According to the Ministry of Transport's pre-holiday forecast, during the 40-day 2024 Spring Festival travel season (January 26 to March 5, 2024), the cumulative passenger traffic volume of civil aviation will reach 80 million passengers, an average of 2 million passengers per day, +9.8% compared to the same period in 2019. In terms of actual performance, as of March 3, 2024 (38th day of the Spring Festival travel season), the cumulative passenger traffic volume of civil aviation had reached 8 million, an average of 2.104 million passengers per day, +15.54% compared with the same period in 2019; during the 8 days of the Spring Festival holiday, the cumulative passenger traffic of civil aviation reached 17.994 million, an average of 2.249 million passengers per day, +18.88% compared with the same period in 2019.
2) Flight volume: During the 2024 Spring Festival travel season, the number of flights continued to exceed the same period in 2019, and the international and regional levels further recovered to post-epidemic highs. As of March 3, 2024 (38th day of the Spring Festival travel season), the country's total daily average number of flights was 15,683, +5.58% compared with the same period in 2019; among them, the average number of domestic daily flights was 13,870, +13.79% compared to the same period in 2019, and the average daily number of international and regional flights was 1,480 and 333, respectively, with recovery rates of 68.96% and 64.70%, respectively. 3) Fares and passenger occupancy rates: The passenger occupancy rate during the 2024 Spring Festival reached 88% over the same period in 2019, and the average economy class fare was +16% compared to the same period in 2019. During the 8-day Spring Festival holiday in 2024, the average passenger occupancy rate reached 88%, exceeding the passenger occupancy rate of 86.5% in the same period in 2019; the average economy class ticket price was 1,011 yuan, +16% compared with the same period in 2019.
2024 Spring Festival travel season: Demand for travel is unprecedentedly strong during the peak season, and the dual drive of “pro-tourism” boosts the industry's prosperity.
As the first Spring Festival travel season not affected by the epidemic, the 2024 Spring Festival travel season was centrally released, and pre-holiday expectations were verified; at the same time, the 2024 Spring Festival 8-day “super long” holiday further catalyzed the release of travel demand during the festival. In particular, the popularity of the “migratory bird route”, which interchanges life scenarios between the north and south of the country, reached a record high. The popularity of Shanghai-Harbin, Hangzhou-Harbin, Guangzhou-Harbin, Guangzhou-Harbin, Guangzhou-Harbin, and Beijing-Sanya all ranked in the top 10.
2024 Spring Festival travel season: The recovery of international flights has accelerated to a post-epidemic high point, and the positive effects of immigration policies have been shown.
During the 2024 Spring Festival 8-day holiday, the average inbound and outbound flight volume of major overseas destinations compared to 2019 was 83% for South Korea, 72% for Japan, 102% for Singapore, 77% for Malaysia, 57% for Indonesia, 76% for Vietnam, 59% for Australia, 87% for Europe, and 22% for the United States.
Looking ahead to the future market: The certainty that public business demand will recover during the off-season in March-April is expected to increase, and tourism demand is expected to be released again during the May 1st peak season.
The 2024 Spring Festival travel season officially ends on March 5, and March-April will enter the traditional dull season. The bank believes that along with further macroeconomic recovery, it is expected to drive greater certainty about the recovery in demand for public and commercial travel. At the same time, it can be seen that the 2024 Spring Festival travel season, as the first Spring Festival travel season not affected by the epidemic, has shown a strong travel trend of homecoming + travel, reflecting the rise in residents' travel demand. Therefore, the forecast is expected to continue the rise in travel demand during the Spring Festival travel season. Looking ahead to the May Day holiday, the bank has a relatively optimistic attitude, and the May Day holiday may continue to release strong travel demand.
Risk warning: the risk that the restoration and development of international routes falls short of expectations; the risk of a sharp rise in crude oil prices, the risk of fluctuations in the RMB exchange rate; the risk that the construction progress of airport renovation and expansion projects falls short of expectations.