NH Investment & Securities raises Korean Air price target 29,000won →34,000won

NH Investment & Securities raised its price target for Korean Air from 29,000won to 34,000won. The report cited deferred passenger demand and expectations of expanded transfer demand as reasons for the increase. It said the effects of the Asiana Airlines merger would be reflected in earnings from next year.

The report said the recovery in passenger demand would lead to improved earnings. Expanded transfer routes were included as a factor supporting the recovery in international passenger demand. It specified that merger-related synergies would be reflected from the following year.

Rather than citing specific cost figures, the report pointed to demand and the effects of the merger as its rationale. Progress on the company’s integration work and the timing of the merger’s impact were identified as key variables. The report focused on changes from next year onward rather than short-term earnings fluctuations.

The report concluded that Korean Air’s future performance would depend on the pace of the international passenger recovery and whether transfer demand rebounds. It said that merger-related disclosures and the integration schedule would determine when the effects are reflected in earnings. The report cited this as a reason for its upgrade.

The report also noted that if air travel demand does not recover in the short term, the effects of the merger may take longer to be reflected. It stated that changes in cost items and whether integration costs arise could affect future performance. The report also mentioned these uncertainties.

Along with raising its target price, the report cited demand recovery and merger effects as supporting factors. Its main grounds were deferred passenger demand, increased transfer traffic, and the phased reflection of merger effects. The report added that merger-related schedules disclosed in the future and quarterly results should be monitored.