Fully Booked: CAO's international flight passenger volume spikes in 1H16

International flight passengers spikes 27%.

China Aviation Oil Singapore Corporation (CAO)'s stellar 48% increase in net profit for the first half of the year came with a surge of bookings from passengers bound abroad.

According to UOB KayHian analyst Edison Chen, this strong performance could linger in the 3Q16, given the surge in international flight passengers.

Quoting data from the Civil Aviation Administration of China, the aviation industry realised a total turnover volume of 45.59b tonne-km in 1H16, up 12.5% YoY with 232.3 million passengers transported.

The number of international flight passengers saw an increase of 27%. Domestic flight passengers, on the other hand, gained 9.1% growth.

With this, Chen said the company could look forward to a strong 2H16 travel bookings.

"According to TravelSky (China’s largest air ticketing system) forward booking system, 2H16 traveling booking outlook appears strong for key destinations besides HK/Macau with bookings for countries like Korea (+67-196% yoy), US (+22%-114%), Europe (12%-80%), Japan (+3-79% yoy) growing significantly," he said.

"Assuming no major changes in oil prices, we are confident of CAO delivering a stellar set of 3Q16 results. General July growth numbers for the industry look positive and we believe it will only get better with the July and August summer holidays," he added.