Shares of China Airlines (中華航空) and EVA Airways (長榮航空) rallied in yesterday morning‘s trade on increased optimism toward their earnings outlook after direct flights between Taipei International Airport (Songshan) and Tokyo International Airport (Haneda) resumed a day earlier following a 31-year hiatus, dealers said.
China Airlines rose 4.61 percent to NT$24.95, while EVA Air gained 6.47 percent to NT$32.90.
China Airlines and EVA Air will provide 14 Taipei-Tokyo return flights each week.
According to Hua Nan Securities (華南永昌投顧), the resumption of direct flights between the two airports is expected to boost the number of Japanese tourists visiting Taiwan by about 10 percent a year.
BENEFICIARIES
“Without doubt, China Airlines and EVA Air are the two direct beneficiaries of the flight resumption,” Hua Nan analyst Henry Miao (苗台生) said.
“The strong buying seen this morning reflects investors’ upbeat mood about the two carriers,” Miao said.
Hua Nan Securities said the new route’s contribution to the two carriers’ sales would become clearer next year, as the contribution to this year’s revenues would be minimal because there are only two months remaining.
Taking the Taipei-Tokyo flights into account, Hua Nan Securities said China Airlines was expected to post earnings per share of NT$2.79 this year and NT$3.07 next year. This compares with a loss per share of NT$0.83 last year, when the global economic meltdown hit the airline business.
Hua Nan Securities forecast EVA would register earnings per share of NT$4.84 for this year and NT$5.08 next year, compared with a loss of NT$0.96 last year.
CONVENIENCE
China Airlines said on Sunday the Taipei-Tokyo flights were expected to have an average capacity of 80 percent because of the increased convenience it offers travelers.
Landing at Haneda rather than at Narita International Airport — the usual destination for international flights, which is farther from Tokyo — can save travelers at least 30 minutes on the commute into Japan’s capital.
Hua Nan Securities had a target price of NT$28 for China Airlines and NT$38 for EVA Air.
Nvidia Corp’s demand for advanced packaging from Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) remains strong though the kind of technology it needs is changing, Nvidia CEO Jensen Huang (黃仁勳) said yesterday, after he was asked whether the company was cutting orders. Nvidia’s most advanced artificial intelligence (AI) chip, Blackwell, consists of multiple chips glued together using a complex chip-on-wafer-on-substrate (CoWoS) advanced packaging technology offered by TSMC, Nvidia’s main contract chipmaker. “As we move into Blackwell, we will use largely CoWoS-L. Of course, we’re still manufacturing Hopper, and Hopper will use CowoS-S. We will also transition the CoWoS-S capacity to CoWos-L,” Huang said
Nvidia Corp CEO Jensen Huang (黃仁勳) is expected to miss the inauguration of US president-elect Donald Trump on Monday, bucking a trend among high-profile US technology leaders. Huang is visiting East Asia this week, as he typically does around the time of the Lunar New Year, a person familiar with the situation said. He has never previously attended a US presidential inauguration, said the person, who asked not to be identified, because the plans have not been announced. That makes Nvidia an exception among the most valuable technology companies, most of which are sending cofounders or CEOs to the event. That includes
TARIFF TRADE-OFF: Machinery exports to China dropped after Beijing ended its tariff reductions in June, while potential new tariffs fueled ‘front-loaded’ orders to the US The nation’s machinery exports to the US amounted to US$7.19 billion last year, surpassing the US$6.86 billion to China to become the largest export destination for the local machinery industry, the Taiwan Association of Machinery Industry (TAMI, 台灣機械公會) said in a report on Jan. 10. It came as some manufacturers brought forward or “front-loaded” US-bound shipments as required by customers ahead of potential tariffs imposed by the new US administration, the association said. During his campaign, US president-elect Donald Trump threatened tariffs of as high as 60 percent on Chinese goods and 10 percent to 20 percent on imports from other countries.
INDUSTRY LEADER: TSMC aims to continue outperforming the industry’s growth and makes 2025 another strong growth year, chairman and CEO C.C. Wei says Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), a major chip supplier to Nvidia Corp and Apple Inc, yesterday said it aims to grow revenue by about 25 percent this year, driven by robust demand for artificial intelligence (AI) chips. That means TSMC would continue to outpace the foundry industry’s 10 percent annual growth this year based on the chipmaker’s estimate. The chipmaker expects revenue from AI-related chips to double this year, extending a three-fold increase last year. The growth would quicken over the next five years at a compound annual growth rate of 45 percent, fueled by strong demand for the high-performance computing