On Tuesday, Krungsri Securities evaluated the operating performance outlook for Bangkok Airways Public Company Limited (SET: BA), projecting a third-quarter 2026 core profit of THB 1,210 million, up 14% year-on-year and 247% quarter-on-quarter. Earnings growth was supported by strong passenger volume growth on flights to and from Koh Samui, the airline’s core route, which offset passenger declines on other routes.
The research firm expects total passenger volume in 3Q26 to increase 4% YoY to 1.08 million passengers, while average ticket prices rose 2% to THB 4,242 and the passenger load factor expanded by 6 percentage points to 85%. Consequently, total revenue grew 5% YoY to THB 6,138 million, with the gross profit margin projected to expand to 31.8%, up approximately 2 percentage points from the same period last year.
For QoQ growth, operating performance is expected to improve significantly as the third quarter marks the peak tourist season for routes to and from Koh Samui. This drove passenger volume up by over 19% QoQ, while average ticket prices increased by 3%, supporting a total revenue expansion of more than 18% QoQ.
Additionally, the company expects to recognize foreign exchange gains, supporting a projected 3Q26 net profit of approximately THB 1,298 million, up 25% YoY and 293% QoQ. This reflects an earnings recovery driven by sustained solid travel demand on primary routes.
However, Krungsri noted that a worse-than-expected escalation in the Middle East conflict has kept jet fuel prices above original baseline assumptions. As a result, the analyst raised its jet fuel price forecasts for 2026 and 2027 by 13% and 7%, respectively, to $144.60 per barrel and $117.30 per barrel.
At the same time, passenger volume forecasts for 2026 – 2027 were downgraded by approximately 2 – 4% to reflect the impact of the conflict. Consequently, the securities firm lowered its 2026 core profit forecast by 9% from the previous estimate to THB 3,539 million (a 5% decline YoY) and reduced its 2027 core profit forecast by 18% to THB 3,236 million (down 9% from 2026).
Despite profit pressures from higher fuel costs, the brokerage assesses that BA maintains a strong capability to preserve profitability, particularly as geopolitical conflicts impact airline operating costs globally. The company’s ability to maintain an annual core profit above THB 3 billion remains above pre-COVID-19 pandemic levels.
For the fourth quarter of 2026 outlook, the analyst projects that although jet fuel prices are trending upward to $170 – $180 per barrel and passenger growth on Samui routes is beginning to moderate, BA retains the potential to maintain core profitability due to its fundamental business strength and cost management capabilities.
Furthermore, operating as a full-service airline enhances flexibility in managing airfares and operational costs amid fuel price volatility. Meanwhile, the company generates over THB 1.3 billion annually in combined dividend income and profit sharing from associate investments, supporting income stability and reducing sole reliance on flight operations.
Simultaneously, BA maintains long-term growth opportunities from its participation in the U-Tapao Airport Development Project. As the brokerage has not yet factored benefits from this project into its earnings estimates, progress in line with plans represents an additional upside catalyst for future equity value.
Overall, Krungsri maintained its “Buy” rating on BA stock while lowering its 2027 target price to THB 23.55 per share from THB 25 to reflect the impact of the Middle East conflict. The securities house remains positive on the company’s underlying fundamentals, citing passenger growth on Samui routes, flexibility in handling elevated fuel costs, and long-term earnings support from dividend income and associate profit shares.
