Visit to LCC Subsidiary ZIPAIR: LCC Business Model (Low-cost) Likely to be a Differentiator Amid Persistent Macroeconomic Uncertainty

Research evidence excerpt

Visit to LCC Subsidiary ZIPAIR: LCC Business Model (Low-cost) Likely to be a Differentiator Amid Persistent Macroeconomic Uncertainty

Update

June 17, 2026 01:58 PM GMT

Morgan Stanley MUFG Securities Co., Ltd.+MJapan Airlines (9201) | Japan Takuya Osaka

Equity Analyst

Visit to LCC Subsidiary ZIPAIR: Takuya.Osaka@morganstanleymufg.com +81 3 6836-5438

LCC Business Model (Low-cost)

Likely to be a Differentiator

Japan Airlines (9201.T, 9201 JT)

Airlines | Japan

Amid Persistent Macroeconomic Stock Rating Equal-weight

Industry View In-Line

Price target ¥2,500Uncertainty Shr price, close (Jun 17, 2026) ¥2,827

Mkt cap, curr, basic (bn) ¥1,235.2

Avg daily trading value (bn) ¥8.4

On Jun 17, we had the opportunity to visit LCC subsidiary ZIPAIR and exchange

opinions with its President & CEO, Yasuhiro Fukada. Our five key takeaways from

discussions with ZIPAIR are as follows. 1) While Middle East tensions will have an

unavoidable adverse impact (particularly higher crude oil prices), it seems ZIPAIR

should be able to avoid an EBIT loss in F3/27 1Q. Inbound demand accounts for an

estimated ~70% of the firm's total demand, and passenger demand remains strong.

In May, RPK (Revenue Passenger Kilometers) was +10.5% YoY (and ASK (Available

Seat Kilometers) -4.2%). 2) Amid an ongoing uncertain demand outlook, we

reconfirmed that good cost performance (low prices) is a factor supporting solid

demand. 3) We estimate the baseline for OPM is 10%, and want to reconfirm that

ZIPAIR's world-class cost competitiveness (low CASK (Cost per Available Seat

Kilometer)) is its biggest differentiating feature. 4) Starlink WiFi has been fully

installed across the firm's entire fleet, which we think will likely provide a non-price-

based competitive edge.