Anna Jiwon Park has been covering the politics at The Korea Times since the summer of 2024, when she joined the press pool for the Office of the President in Korea. Prior to that, she spent about five years reporting extensively on financial markets, regulatory authorities and the financial industry. She joined The Korea Times in 2019 after spending eight years as a broadcast journalist at Arirang TV, Korea’s leading global broadcaster, covering politics, defense and culture.
Aviation stocks find rising momentum
Aircraft are parked on the apron at the Incheon International Airport in Incheon on Nov. 2. Yonhap
By Anna J. Park
Airlines to enjoy boon in 2024 over recovered demand, low energy prices
Aviation stocks have been enjoying an upward trend, mainly buoyed by the recovery in passenger numbers, growth in freight business and a recent decline in global oil prices.
According to the Korea Exchange (KRX) on Tuesday, the stock price of Korean Air, the representative share of the industry, rose by over 20 percent in the past two months.
The stock price ended at 24,000 won ($18.51) on Tuesday's closing, a 1.27 percent increase from the previous trading session. When compared to the closing price of 19,590 won on Oct. 26, the stock rose by 22.5 percent. The increase rate during the past two months is much higher than the overall performance of the main benchmark KOSPI during the same period, which posted a jump of about 13 percent.
Other aviation stocks, including Air Busan, Jeju Air and T'way Air are also trending upwards, each marking 19 percent, 17 percent and 10 percent increases, respectively over the same period.
Analysts expect the upturn of the aviation sector is expected to continue into next year, as both domestic and global demands, which have almost recovered to pre-pandemic levels during the second half of this year, are expected to surpass pre-pandemic levels by next year.
The latest data by the Ministry of Land, Infrastructure and Transport shows that the Incheon International Airport's passenger transportation performance stood at 5.07 million in November, which is 91 percent of the level in November 2019, just months before the outbreak of COVID-19 in early 2020.
"The International Air Transport Association (IATA), representing 320 airlines worldwide and accounting for 83 percent of global air traffic, has forecast robust passenger demand in 2024, leading to record-breaking performance next year," Kou Sun-young, an analyst at Yuanta Securities Korea, pointed out.
"The IATA forecasts the number of airline passengers in all regions except the Asia Pacific will reach pre-pandemic levels, and from 2024 onwards, a recovery exceeding the 2019 levels will be observed globally," she said, adding that such strong demand is expected to favorably affect the earnings of airliners next year.
Besides passenger transportation, freight transportation continues to rise. Korean Air posted a monthly freight transportation of 107,162 tons in November, which is the record-high for this year. It's also a 10.6 percent increase year-on-year.