Thai Airways soars 400% on the stock market, but remains under pressure

After a spectacular surge of +400% in just two weeks on the Bangkok Stock Exchange, Thai Airways is attracting investors.

But the company still faces significant challenges.

With its stock surging in just 15 days after Thai Airways International (THAI) resumed trading on the Stock Exchange of Thailand (SET) on August 4, the national airline has undoubtedly attracted the attention of many investors.

This increase follows impressive financial results in the second quarter.

Normalized profits far exceeded market estimates, rising 465% from a year earlier thanks to lower fuel costs and interest expenses, as debt was reduced as part of a company turnaround plan.

Although profits are expected to slow in the second half of 2025, analysts have raised their net profit estimates for THAI for that year and 2026, citing growing travel demand and expanding routes.

Parin Kitchatornpitak, an analyst at KGI Securities (Thailand), said:

“THAI is experiencing a positive evolution in its sales mix.

The proportion of network passengers increased from 6% in 2023 to 15% in 2024 and 21% in the first six months of 2025, while the proportion of point-to-point passengers decreased to 79%, compared to 94% in 2023 and 85% in 2024.

This is a positive development for the company, which has to face the off-peak season.

The airline's available seat kilometers increased by 15% compared to the previous year.

This increase is explained by increased use of aircraft and the resumption of the main European routes (Oslo, Milan and Brussels).

It is also linked to the increase in frequencies on Asian regional routes, in order to meet the growing demand for travel.

Pasakorn Wangvivatchareon, an analyst at Asia Plus Securities, said:

Asia Plus Securities has raised its normalized profit forecast for THAI this year by 15% to 32 billion baht, a growth of 49%, to reach 33 billion baht next year, up 2% from a year earlier.

Profit growth is expected to reach a new high this year, thanks to lower operating costs and interest expenses.

Profit growth is expected to return to a normal pace from 2026 onwards.

Maybank Securities (Thailand) increased THAI's earnings by 13% and 7% for 2025 and 2026, respectively, to reflect better cost control this year, mainly in maintenance and employee benefits.

“First-half earnings reached 56% of our full-year forecast.

Earnings were likely concentrated at the beginning of the year, while we expect earnings to contract in the second half compared to the first six months, partly due to seasonal factors,” said analyst Boonyakorn Amornsank.

Chai Eamsiri, the airline's chief executive, said THAI had attracted a lot of interest from investors.

His goal now is to restore the carrier's image to make it a "value stock rather than a speculative stock" in order to generate long-term returns.

Fleet and route expansion

Thai Airways planes.

Before the stock market resumed trading, Mr. Chai said THAI aimed to double its fleet to 150 aircraft by 2033 to capitalize on the boom in tourism in Asia, including 98 wide-body models and 52 narrow-body models.

See: Thai Airways to expand network and increase flight frequency

The airline aims to expand its fleet to 93 aircraft next year, up from 78 in the first quarter of this year, down from 103 before its restructuring.

On June 16, the Central Bankruptcy Court allowed THAI to exit its reorganization program.

The company filed for receivership in May 2020 after accumulating a crippling debt of 400 billion baht.

The airline plans to add three more planes later this year, mainly to serve expanding Chinese and Indian routes in late 2025 or early 2026, Chai said.

Fifteen more A321neos are expected to be delivered starting next year.

To fill capacity gaps before the arrival of the new aircraft, THAI plans to lease 8 to 10 wide-body aircraft for a period of six years.

Additionally, cabin renovations are planned for its Airbus A320, Boeing 777-300ER and Airbus A350 to standardize the products offered on board.

He said the airline plans to double the frequency of its flights to Guangzhou and Beijing, from seven to 14 weekly flights for each, for the 2025-2026 winter schedule.

THAI will also resume services to Xiamen, Chongqing and Changsha, with seven flights per week to each of these destinations, and introduce new routes to Wuhan and Shenzhen, Mr. Chai said.

“Chinese routes attract not only Chinese passengers, but also travelers from Europe and Australia transiting through Bangkok, which underlines THAI’s network-oriented model.

Current load factors on Chinese routes average 70% in low season and around 80% in high season,” he said.

THAI also plans to launch new services to Gaya, India, as well as several new domestic routes, upon delivery of its new aircraft, Chai said.

The challenges to be met

Thai Airways plane on a beach in Phuket

He admitted that plans to expand flights and routes could be delayed as the airline has been unable to secure enough additional aircraft, including wide-body jets for its expanded European routes.

THAI is relying on leased aircraft to bridge the gap before delivery of purchased aircraft, scheduled for 2027.

Mr. Chai also acknowledged that THAI was likely to face a "significant shortage of seats" as part of its growth plan for the next two years.

"We will have to suspend the opening of new routes and new flights if we fail to lease new wide-body aircraft by the first half of 2026," he said in an interview last month.

Maybank's Mr. Boonyakorn said that despite a reduced fleet, THAI's passenger revenue has fully recovered and even exceeded pre-pandemic levels.

This recovery is explained by the return of regular flights and the launch of new connections.

It is also driven by a high occupancy rate, increased passenger demand, stricter fare discipline and strong travel demand.

However, he acknowledged that aircraft deliveries could be delayed, particularly for the B787-9 model, while reduced room for cost reduction could hurt investor sentiment toward THAI stock.

Mr. Boonyakorn said:

"Management expects the delivery of the B787-9 model to be delayed from the planned 2027 date, which we believe will have an impact on the industry, but more importantly on the competitive advantage of THAI, whose fleet remains smaller than that of its competitors."

THAI's aircraft utilization rate of 13.6 hours per day in the first six months of 2025 is extremely high compared to the 12 hours recorded before the pandemic.

According to Maybank, management plans to maintain this level of utilization.

Other downside risks include the possible escalation of war in the Middle East and OPEC production cuts leading to a rise in oil prices, including kerosene.

The weak global economy could also slow travel demand, the brokerage noted.

Additionally, an early recovery in seat supply in the aviation sector could lead to lower yields per passenger on airfares, he said.

See also:

Thai Airways emerges from recovery and prepares for its return to the stock market

Thai Airways announces colossal losses but promises strong comeback

Thai Airways ranked among the world's top 10 airlines

Thai Airways' Amazing Journey from Bankruptcy to Recovery

Thai Airways rehabilitation project will reveal Pandora's box of corruption

Source: Bangkok Post