NH Investment & Securities analyzed on the 31st that competition among low-cost carriers (LCCs) has intensified, leading to expected fare weakness. The investment opinion is 'buy' and the target price is lowered from 14,000 won to 11,000 won, a decrease of 21%. JIN AIR's closing price was 8,970 won on the previous day.
NH Investment & Securities analyzed that domestic competing LCCs are experiencing expanded operating losses and rapidly deteriorating financial structures due to aggressive fare discount policies and offensive supply expansion strategies.
Jeong Yeon-seung, a researcher at NH Investment & Securities, noted, 'Considering the rapidly deteriorating financial structure, these policies are judged to have low sustainability.'
He expected that the supply expansion strategies of LCCs would be revised starting next year.
The researcher explained, 'In particular, JIN AIR, which has a relatively stable financial structure among low-cost carriers and has the potential for expansion due to its integration with Asiana Airlines' affiliated LCC, has the highest sustainability,' maintaining a buy recommendation.
Meanwhile, NH Investment & Securities predicted that JIN AIR will record an operating loss of 11.9 billion won in the second quarter of this year. They anticipate revenue to decrease by 2% year-on-year to 302 billion won.