Zhijia Finance APP reports that Guosheng Securities released a research report stating that as of October 14, 2025, the daily execution volume of civil aviation flights in 2025 reached 15,539, compared to 14,980 for the same period in 2024, representing a year-on-year increase of 3.73%. Flight volume has been steadily increasing. From the perspective of passenger load factor, in the period from July to September 2025, the load factors for civil aviation were 84.5%, 87.5%, and 85.8%, all surpassing the levels of the same period in 2019. The current low growth rate in airline supply, coupled with ongoing demand recovery, is narrowing the supply-demand gap, aided by a decline in fuel prices and the implementation of "anti-involution" policies, while prices are expected to continue recovering and airline profitability is set to improve. The report emphasizes the continued observation of demand recovery, highlighting the importance of business travel and the restoration of international flights. Guosheng's main points are as follows: Record-breaking holiday personnel flow, strong travel intentions. The combined National Day and Mid-Autumn Festival holidays, along with convenient "flexible leave" options, have stimulated significant private travel intentions during these holidays, creating conditions for long trips and deep travel experiences. According to data from the Ministry of Transport, between October 1 and 8, 2025 (the National Day and Mid-Autumn Festival holidays), the estimated inter-regional personnel flow across the entire society reached 2.432 billion, a historical high for the same period, with an expected daily year-on-year increase of 6.2%. During this period, civil aviation passenger volume reached 19.138 million, averaging 2.392 million per day, reflecting year-on-year increases of 4.1% and 26.9% compared to 2024 and 2019, respectively. The record-high personnel flow data during the holidays and the year-on-year growth in civil aviation passenger volume highlight the resilience of civil aviation demand. Flight volume continues to increase steadily, with load factors rising and ticket prices recovering. As of October 14, 2025, the daily execution volume for civil aviation flights stood at 15,539, a 3.73% increase from the same period in 2024. Passenger load factors for civil aviation in July to September 2025 were 84.5%, 87.5%, and 85.8%, all above 2019 levels. In September 2025, the average passenger load factor for the three major airlines reached 85.7%, marking a 5 percentage point uptick from the same period in 2019, outperforming the industry average increase. In September 2025, the average inclusive tax price for domestic economy class tickets in civil aviation was 697 RMB, reflecting a year-on-year increase of 0.6%, and a decrease of 5.0% compared to September 2019. During the National Day and Mid-Autumn Festival holiday period in 2025, the average ticket price for domestic economy class tickets was 849 RMB, up 0.3% from the previous year, and down 1.4% compared to the 2019 holiday period, indicating a continued recovery in ticket prices. The growth in international flights has been remarkable, while domestic flights have shown stable progress. Analyzing the flight volume structure reveals significant increases in international flights and those to Hong Kong, Macau, and Taiwan. As of October 14, 2025, the average daily execution volume for international flights and flights to Hong Kong, Macau, and Taiwan reached 2,154, marking a year-on-year increase of 16.70%. The average daily execution volume for domestic flights was 13,885, a year-on-year increase of 1.91%. With the ongoing expansion of visa exemptions, international travel and exchange demands are being continually activated. By the end of June 2025, the volume of international flights had recovered to 88% of the same period in 2019. Capacity expansion remains limited. It is expected that the low growth rate in supply will continue to be affected by special health events and conflicts in the international political landscape, resulting in severe impacts on the manufacturing supply chains of major global aircraft manufacturers. The pace of aircraft deliveries worldwide has significantly slowed, with Boeing and Airbus projected to deliver 348 and 766 planes, respectively, in 2024, representing year-on-year declines of 34.1% and increases of 4.2%. Future aircraft deliveries are expected to remain under pressure; taking into account the delivery cycle of domestically produced C919 aircraft, the aging of existing fleets is leading to gradual retirements, and increasingly strict industry regulatory entry limitations are anticipated to continue constraining future air transport capacity expansion, keeping supply growth at a low rate. Oil prices have declined, and the results of comprehensive efforts to address "involution-style" competition await implementation. Since 2025, international oil prices have been on a downward trend, leading to reduced jet fuel costs which are beneficial for airline profitability. On June 26, 2025, the civil aviation sector commenced efforts to combat "involution". Such "involution-type" competition primarily involved ongoing declines in ticket prices leading to "involution". With the continuous advancement of "anti-involution" policies and the effective implementation of comprehensive remediation measures, the recovery of ticket prices in the civil aviation sector is expected. Investment suggestions indicate that as supply growth remains low and demand continues to recover, the shrinking supply-demand gap, coupled with declining fuel prices and the advancement of "anti-involution" policies, may lead to ongoing price recovery and improved airline profitability. Continuous monitoring of demand recovery is recommended, with a focus on business travel needs and the restoration of international flights. It is advisable to consider investments in the airline sector, paying attention to 華夏航空 (002928.SZ), 中國國航 (601111.SH, 00753), 中國東航 (600115.SH, 00670), 中國南方航空 (600029.SH, 01055), 吉祥航空 (603885.SH), and 春秋航空 (601021.SH). Risk warnings include the possibility of demand recovery falling short of expectations, issues with the reliability of third-party data, risks from domestic and international policy changes, substantial depreciation of the RMB, and significant increases in oil prices.