Asia Essentials - 26 May 2026

Research evidence excerpt

Asia Essentials - 26 May 2026

Macquarie Equity Research

25 May 2026

Transportation

Thai Airways Intl ASEAN

Jet fuel - the only number that truly matters

Kaushal

Key Points Ladha, CFA

• Jet fuel is a key earnings lever; it is down 33% to $147/bbl from peak

crisis while domestic access has been uninterrupted. THAI TB Outperform

(at 25 May 2026) THB6.70• We expect 2Q26 to be the trough, with an eventual stabilisation and Price 12-month target THB10.00 pick-up in 2H26.

12-month TSR (%) 51.7

• Valuation offers a high margin of safety; August expiry of lock-up Volatility Index Very High

period is a key overhang but has been partially tested. Market Cap (Local) (m) 189,632

Market Cap (USD) (m) 5,807

Free Float (%) 23

• THAI is trading at 4.2x EV/EBITDA for a 20% ROE airline with upcoming 30-day avg turnover (USD) (m) 4.4

catalysts, a structural cost reset, and asymmetric earnings leverage to

Investment Fundamentals jet fuel prices. The dominant sell-side risk, the August lock-up, has been

Year end 31 Dec 2025E 2026E 2027E 2028E

partially tested by the first expiry. THAI is trading at FY26E discount of Revenue (bn) 183.4 184.2 198.4 210.2

20% to Asia (ex India, China) peers. Catalysts below Revenue growth (%) (2.0) 0.4 7.8 5.9

Þ EBIT (bn) 35.3 28.8 36.6 42.1 SET50 inclusion (July) - index buying should set a technical floor. EBIT growth (%) (15.9) (18.5) 27.0 15.1

Reported profit (bn) 30.9 17.4 24.2 29.7

Þ Adjusted profit (bn) 29.1 17.4 24.2 29.7 Fuel normalisation (2H26) - jet fuel is down 33% from April peak.

Our model shows each US$10/bbl drop adds Bt5.5bn to FY26E EPS rep [THB] 1.1 0.6 0.9 1.0

EPS rep growth (%) NM (43.6) 38.7 22.7

EBITDA (12% uplift), net of THAI's hedging position (30-50%). EPS adj [THB] 1.0 0.6 0.9 1.0

Þ Net debt/equity (%) 51.5 55.2 23.7 30.6