Heungkuk Securities lowered its target price from 24,586 won to 14,000 won, citing an increase in the number of outstanding stocks due to an increase in paid-in capital and a general change in the internal and external environment before COVID-19. However, considering next year’s performance, etc., the investment rating was maintained at ‘Buy’, saying it is undervalued compared to competitors.
In the third quarter of this year, Jeju Air recorded sales of 195.7 billion won and an operating loss of 61.6 billion won. Compared to the same period last year, sales increased by 187%, but the deficit continued. Operating profit was also lower than the market estimate (21.1 billion won loss). Regarding this, Lee Byung-geun, a researcher at Heungkuk Securities, explained, “The loss in the third quarter is deemed to have increased because demand did not keep up in July when supply was greatly increased in anticipation of a strong recovery.”
However, from the fourth quarter, it is anticipated that it will be possible to turn to the black, focusing on routes to Japan, which is Jeju Air’s strength. “Jeju Air’s passenger recovery has been steep since the 11th of last month, when travel to Japan began in earnest,” Lee said.
“December is the peak travel season, and it is considered possible to recover up to 70% compared to 2019,” he said. He added, “Given the speed of recovery and next year’s performance, it is undervalued compared to competitors,” adding, “It is judged to be the most attractive among domestic LCCs.”
Reporter Shin Hyun-ah, Hankyung.com sha0119@hankyung.com
