Company Coverage
Thai Airways (THAI TB): Expect Weak Earnings In 2Q26, But With An Improving Outlook In 3Q26
BUY (Upgraded)
Current price:
Target price:
Upside:
Previous TP :
Bt5.90
Bt6.80
+15.3%
Bt6.20
Analyst
Analyst
Nonpawit Vathanadachakul
Highlights
- THAI should report a net profit of Bt2.27b (-81.3% yoy, -77.5% qoq) in 2Q26, with the decline mainly due to the increasing fuel expense yoy.
- We expect near-term volatility in the share price from the second unlock period and see an opportunity to buy on the dip.
- We see that THAI’s valuation is undemanding and we are more positive about the improving 3Q26 outlook. Upgrade to BUY with a target price of Bt6.80 (previously Bt6.20).
Analysis
- Expect a weakened net profit 2Q26, due to the rising jet fuel price. Thai Airways (THAI) should report a net profit of Bt2.27b in 2Q26 (-81.3% yoy, -77.5% qoq). In this quarter, we expect a net loss of around Bt130m from the foreign exchange loss from Thai baht appreciation which offset the gain from derivatives. The yoy drop in earnings is mainly due to the rising fuel cost which increased by 70% yoy. Considering the volatile situation in 1Q-2Q26, the fact that THAI can still be profit-making is impressive. In 2Q26, there are no notable yoy increases in expenses other than jet fuel. The top-line should be at Bt46.1b (+6.4% yoy, -7.2% qoq) with the yoy growth mainly driven by a strong increase in passenger yield and cargo yield. However, other metrics such as the cabin factor and Available Seat Kilometers (ASK) have declined yoy understandably from the reduction in flights. The margin has been squeezed significantly yoy.
Highlights
- THAI should report a net profit of Bt2.27b (-81.3% yoy, -77.5% qoq) in 2Q26, with the decline mainly due to the increasing fuel expense yoy.
- We expect near-term volatility in the share price from the second unlock period and see an opportunity to buy on the dip.
- We see that THAI’s valuation is undemanding and we are more positive about the improving 3Q26 outlook. Upgrade to BUY with a target price of Bt6.80 (previously Bt6.20).
Analysis
- Expect a weakened net profit 2Q26, due to the rising jet fuel price. Thai Airways (THAI) should report a net profit of Bt2.27b in 2Q26 (-81.3% yoy, -77.5% qoq). In this quarter, we expect a net loss of around Bt130m from the foreign exchange loss from Thai baht appreciation which offset the gain from derivatives. The yoy drop in earnings is mainly due to the rising fuel cost which increased by 70% yoy. Considering the volatile situation in 1Q-2Q26, the fact that THAI can still be profit-making is impressive. In 2Q26, there are no notable yoy increases in expenses other than jet fuel. The top-line should be at Bt46.1b (+6.4% yoy, -7.2% qoq) with the yoy growth mainly driven by a strong increase in passenger yield and cargo yield. However, other metrics such as the cabin factor and Available Seat Kilometers (ASK) have declined yoy understandably from the reduction in flights. The margin has been squeezed significantly yoy.
BUY (Upgraded)
Current price:
Target price:
Upside:
Previous TP :
Bt5.90
Bt6.80
+15.3%
Bt6.20
Analyst
Analyst
Nonpawit Vathanadachakul
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