Thailand Leisure: Air capacity inflection & easing fares improve hotel outlook

Research evidence excerpt

Thailand Leisure: Air capacity inflection & easing fares improve hotel outlook

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29 Jun 2026 03:23:57 ET │ 35 pages

Thailand Leisure

Air capacity inflection & easing fares improve hotel outlook

CITI'S TAKE

Jate Jaturanpinyo AC

We expect a normalisation of air capacity from SepQ-26 and gradual +66-0279-3148

reversion of air fares to improve travel sentiment after jet fuel price has jate.jaturanpinyo@citi.com

declined to 118% of pre-conflict vs late-March peak at 250%. Solid line-up

of large MICE events and potential government stimulus are further boosts, Kaseedit Choonnawat

driving our resilient 3-7% 26E RevPAR growth forecast. We prefer Hotels to +66-2-079-3606

Airlines with ERW (Buy; TP Bt3.6) and MINT (Buy; TP Bt35.0) as hotel picks. kaseedit.choonnawat@citi.com

We like THAI (Buy TP Bt9.2) as the most direct beneficiary of falling fuel price

but point to 4th Aug share supply influx as an overhang. Our recent U/G on

AOT to Buy (TP Bt70.0) is underpinned by the new regulated asset-base

(RAB) framework and potential landing & parking charges hike.

Inflection of air capacity — Air capacity cuts were concentrated in JunQ-26 as jet

fuel expense reached cash-burn levels for some airlines. The recent decline in fuel

costs has prompted APAC carriers to signal a return to (or near) pre-conflict capacity

by SepQ-26. We also expect a gradual decline in ticket prices as airlines refocus on

load factor. While Thailand inbound air capacity is tracking -1% for 2H26, we are

already seeing inflections of capacity (Figure 5), especially for DecQ-26. We

therefore revised our 26E Thailand tourist arrivals to 33m (0% YoY) from 32m.

Strong 2H26 outlook for hotels — We see a supportive demand backdrop in 2H26,