JPMorgan analyzed the development prospects of airlines in Hong Kong/China in its research report on the 28th. JPMorgan believes that the decline in rbob gasoline costs will alleviate the major cost pressures on airlines, supporting the improvement in profit margins. The tight market supply is expected to improve revenue management, allowing airlines to optimize pricing strategies in response to strong demand. Furthermore, due to specific policies leading to a surge in cargo rush and cross-border e-commerce business, demand is expected to increase further, especially for air freight. The strategic initiative of China to expand the visa-free entry program will also boost passenger flow. Signs of a rebound in domestic ticket prices, especially during the off-season, are also encouraging, and prices are expected to rise during the upcoming Spring Festival, stimulating revenue growth expectations.

The report also mentioned that given the close relationship between air travel demand and GDP growth, the tightening supply and the prospects of domestic stimulus measures in 2025, along with the gradual increase in international flights, these factors could boost the performance of the aviation industry, thereby creating a more favorable pricing environment and enhancing overall profitability in light of the declining rbob gasoline costs.

The report indicated that due to the decline in rbob gasoline costs, the cargo rush, and supply tightness, the performance of these airlines is expected to improve significantly. In particular, Cathay Pac Air is under positive catalyst observation, while Air China Limited and China Southern Airlines have had their ratings upgraded to 'shareholding.' The order of stock selection by the bank is: Cathay Pac Air, Air China Limited, China Southern Airlines, and China Eastern Airlines.