China Airlines and EVA Air surge; Thai Airways developing plan to end state control
Taiwan's China Airlines led airlines, property and hotel stocks higher in Taipei trading after the ruling Kuomintang party won three of five seats in the mayoral elections on 27-Nov-2010, prompting speculation President Ma Ying-jeou will extend pro-China policies.
- Taiwan's China Airlines and EVA Airways experience a surge in stock prices following the ruling Kuomintang party's victory in the mayoral elections.
- Improved relations with China have led to increased capital inflows and benefited both China Airlines and EVA Airways.
- China Eastern Airlines and China Southern Airlines also outperformed the market in Hong Kong.
- Thai Airways is developing a plan to end state control and reduce the Ministry of Finance's stake in the carrier.
- Thai Airways' shares gained 7.3% following the announcement.
- Skywest expects lower net profits in the first half of the fiscal year due to one-off costs but anticipates improved operating performance.
China Airline shares soared 6.8% to TWD24.25 with EVA Airways shares surging 5.0%.
Taiwan's Taiex Index gained 0.7% yesterday and has advanced 2.2% this year after surging 78% in 2009 as improving relations with China boosted capital inflows. Both EVA Airways and China Airlines have benefited from operating direct service to China.
Shares in China Eastern Airlines and China Southern Airlines both outperformed the market in Hong Kong yesterday. China Eastern shares gained 1.6% while China Southern shares added 2.0%.
Thai Airways developing plan to end state control
Shares in Thai Airways gained 7.3% yesterday. Late last week, Thai Airways President Piyasvasti Amranand stated the carrier is developing a plan to end state control.
The carrier is in talks with local and foreign creditors to remove debt covenants, which will allow Thailand's Ministry of Finance to reduce its stake in the carrier from 51% to 49.9%. State Enterprise Policy Office Director General Somchai Sujjapongse stated the ministry is "ready to consider that", as the carrier "will be more flexible and better able to compete with the private sector" if it is not a state enterprise.
Skywest expects lower net profits in 1H2010/11
Skywest yesterday stated it expects lower net profits for 1H2010-2011 due to one-off costs incurred by adding new A320-200 aircraft to its fleet and AOC but added that it expects basic operating performance for the six months ending 31-Dec-2010 "to be slightly ahead" of performance in the previous corresponding period. The carrier's shareholders, meanwhile, approved a dividend of SGD 1.10 cents per share.
Asia Pacific selected airlines daily share price movements (% change): 29-Nov-2010
Source: Centre for Asia Pacific Aviation, Reuters & Financial Times