In early trading on the 16th, Korean Air is surging more than 8%. Analysts in the securities industry said investor sentiment appears to be buoyed by signs of a recovery in revenue on China routes and an improvement in the air cargo market as investment in servers related to artificial intelligence (AI) expands.
As of 9:31 a.m. on the 16th, Korean Air was trading at 24,900 won, up 1,900 won (8.26%) from the previous trading day on the Korea Exchange.
Kang Sung-jin, a KB Securities analyst, said, "Korean Air is benefiting simultaneously from China's lifting of restrictions on group tours to Japan and the increase in AI investment," adding, "With low oil prices holding, the company is facing the best-case scenario of an improving market." He then raised his operating profit forecasts for this year and next by 5.3% and 6.3%, respectively, from his previous estimates.
However, affiliate results were cited as a drag. Jeong Yeon-seung, an NH Investment & Securities analyst, said, "Thanks to peak-season effects, international passenger traffic and air cargo rates are rising, and standalone results are sound, but the deterioration in long-haul route profitability at Asiana Airlines and the overall slowdown in affiliate performance are drags."