Unattractive valuation and slow recovery
- Downgrade to FULLY VALUED with lower TP of HK$4.20
- 1H22 net loss of RMB19.4bn is a record low, equivalent to two-three years of annual profit prior to COVID-19
- Cut FY22/23F net profit estimates to factor in higher rate of lockdowns and lack of visibility on resumption of international flights
- Stark divergence between share price performance and fundamentals underpins our FULLY VALUED call
