CSN(600029) 华创证券·2024-03-31 16:00Investment Rating - The report maintains a "Recommended" rating for China Southern Airlines (600029) [1] Core Views - In 2023, the company reported a net loss attributable to shareholders of 4.2 billion RMB, with a significant loss of 5.5 billion RMB in Q4 [1] - The revenue for 2023 reached 159.9 billion RMB, representing an increase of 83.7% year-on-year [1] - The report anticipates a positive start to the 2024 peak season, with expected net profits of 6.8 billion RMB and 10.6 billion RMB for 2024 and 2025, respectively [1] Financial Data Summary - 2023 Financial Performance: - Total revenue: 159.9 billion RMB, up 83.7% YoY - Net loss: 4.2 billion RMB, compared to a loss of 32.7 billion RMB in 2022 - Q4 revenue: 40.4 billion RMB, up 139.3% YoY, with a net loss of 5.5 billion RMB [1] - Operational Metrics: - Available Seat Kilometers (ASK) increased by 105.5% YoY in 2023 - Revenue Passenger Kilometers (RPK) rose by 141.9% YoY - Passenger load factor reached 78.1%, up 11.7 percentage points YoY [1] - Cost Structure: - Operating costs for 2023 were 147.6 billion RMB, up 39.4% YoY - Fuel costs were 52.1 billion RMB, a 59.3% increase YoY [1] Earnings Forecast - The report adjusts the profit forecast for 2024 and 2025 to 6.8 billion RMB and 10.6 billion RMB, respectively, with an introduction of a 2026 forecast of 14.4 billion RMB [1] - Corresponding EPS for 2024, 2025, and 2026 are projected at 0.37 RMB, 0.59 RMB, and 0.80 RMB, respectively [1] Valuation - The target price is set at 7.03 RMB, indicating a potential upside of 26% from the current price of 5.59 RMB [2]