THAI faces a major test as 565 million shares worth ฿3.39 billion go on sale at a discount on Thursday. The move comes as soaring jet fuel costs force Thai airlines to slash routes across Asia, raising fresh questions over profits, demand and investor confidence.
Thai Airways International Plc faces a critical market test on Thursday as institutional shareholders prepare to sell nearly 565 million shares worth about ฿3.39 billion at a discount, according to Bloomberg News. The offering comes as THAI and other carriers cut routes across Asia, fuel costs climb from roughly 30% to more than 50% of operating expenses and concerns over jet fuel supplies deepen, placing Thailand’s aviation sector under mounting financial and operational pressure.
Thai Airways International Plc (THAI) faces a pivotal market test on Thursday after Bloomberg News reported that institutional shareholders will sell nearly 565 million shares at a discount. The planned disposal comes as Thailand’s aviation industry confronts rising fuel costs, shrinking margins and widespread route reductions.
According to Bloomberg, approximately 564.96 million THAI shares will be offered on June 18 at 6 baht each. The price is roughly 7.69% below the current market value. UBS is acting as lead underwriter for the transaction.
The shares are being marketed to international investors. At the offer price, the placement is valued at about 3.39 billion baht.
Major THAI share sale tests investor confidence as aviation fuel pressures intensify across the sector
The sale originates from five institutional shareholders. They are the Electricity Generating Authority of Thailand Credit Union, Thammasat University Credit Union, Mahidol University Credit Union, Aeronautical Radio of Thailand Credit Union and the Metropolitan Waterworks Authority Credit Union. Collectively, they hold one of the largest institutional stakes in the airline.
Notably, the disposal follows a strong run in THAI shares. The stock has gained approximately 9.24% over the past month. That rise came despite continued volatility across aviation markets. Investors have remained focused on the carrier’s recovery and restructuring progress. Thursday’s placement will now provide a fresh test of demand.
In financial markets, large placements often create short-term supply pressure. The discount is designed to attract buyers. However, the size of the offering means trading activity will be watched closely. Market participants will assess both investor appetite and the impact on THAI’s share price.
At the same time, the airline industry faces a growing operational challenge. Carriers across Thailand continue to struggle with elevated Jet A-1 fuel costs. The pressure emerged after hostilities in the Middle East disrupted energy markets and tightened supply conditions. Since then, airlines have steadily reduced capacity and revised schedules.
Fuel costs exceed half of airline expenses as carriers face severe margin pressure and route reviews
Previously, fuel accounted for around 30% of airline operating costs. Now, airlines report fuel expenses exceeding 50% of total costs. Some carriers say fuel prices have risen more than threefold. As a result, route planning has become increasingly difficult. Airlines have been forced to align schedules with operating realities.
In response, carriers began reducing services earlier this year. The first significant cuts emerged in April. A broader wave followed in May. Those reductions are now extending into the third quarter. Airlines cite both weaker seasonal demand and sharply higher operating expenses.
Meanwhile, passenger volumes have softened during the low season. That trend has compounded the pressure from fuel costs. Airlines are therefore concentrating resources on stronger routes. Less profitable services are being reduced or suspended altogether.
Thai Airways cuts routes to India, Taiwan, Hong Kong and Japan as fuel costs continue climbing
Thai Airways has already announced extensive changes to its network. Flights TG335 from Bangkok to New Delhi have been cancelled throughout June. Return service TG336 has also been suspended for the month. The move removes a key South Asian connection during a traditionally quieter travel period.
Elsewhere, the airline has repeatedly cancelled flights between Bangkok and Kaohsiung. Services TG630 and TG631 have been removed on multiple dates throughout June. The reductions affect both outbound and return operations.
Similarly, flights between Bangkok and Hong Kong have faced repeated cancellations. Services TG638 and TG639 have been removed on selected dates. Hong Kong remains one of Asia’s busiest aviation markets. Even so, airlines are reassessing route economics as fuel expenses rise.
On another front, THAI has reduced services between Bangkok and Sapporo. Flights TG670 and TG671 have been cancelled on several dates during June. The adjustments affect one of the carrier’s established East Asian routes.
Four month Changsha suspension highlights the scale of network reductions now facing Thai Airways
Most significantly, THAI suspended flights between Bangkok and Changsha until September 30. Services TG694 and TG695 were withdrawn from June 1. The four-month suspension represents one of the airline’s longest route cuts announced this year.
Taken together, the changes illustrate the scale of the industry’s challenge. Airlines are not simply trimming frequencies. They are also removing routes for extended periods. The objective is to contain costs while preserving network strength on core services.
Thai Lion Air is implementing similar measures. The carrier has suspended flights between Don Mueang and Shenzhen for most of June. Services to Tianjin have also been halted through July. Both routes previously formed part of the airline’s China network.
As part of this restructuring, flights to Datong, Hefei, Jinan and Nanchang have also been suspended. Services to Linyi have been withdrawn until September 30. These cuts affect multiple destinations across mainland China.
Thai Lion Air expands suspensions across China, India and regional markets amid fuel cost surge
Separately, Thai Lion Air suspended flights to Amritsar until August 31. Services to Xi’an have also been halted between June 2 and July 2, except for June 21. The reductions span several important regional markets.
The airline has additionally reduced frequencies on routes to Bengaluru, Delhi, Surabaya and Kathmandu. Rather than complete suspensions, these services will operate with fewer flights. That approach allows carriers to retain market presence while reducing costs.
Further pressure is evident on longer regional sectors. The Don Mueang-Taipei-Nagoya route will be suspended from July 6 to July 31. Previously, the service operated three flights daily. The reduction represents a substantial capacity cut on a major Northeast Asian corridor.
In Phuket, services to Singapore have also been affected. Flights were suspended from June 3 until August 1. Afterwards, operations will resume at two flights per week. Previously, four weekly services were available.
Across the sector, airlines are making similar calculations. Fuel costs remain exceptionally high. Demand remains uneven. Consequently, carriers are matching capacity more closely to revenue expectations.
Beyond Asia, concerns are also emerging over supply availability. European authorities have warned that jet fuel shortages could develop within weeks. Such warnings have added another layer of uncertainty for airlines already facing higher costs.
Airlines brace for further uncertainty as fuel supply concerns spread beyond Asia to Europe
For Thai carriers, the timing is particularly difficult. The industry has entered its seasonal slowdown. At the same moment, fuel expenses remain elevated. Airlines therefore have limited flexibility when managing costs.
Nevertheless, carriers continue to maintain capacity on strategic routes. Airlines say they remain prepared to restore services if fuel prices ease and demand recovers. Until then, schedule adjustments are expected to remain a key management tool.
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Against that backdrop, Thursday’s THAI share placement carries added significance. The offering arrives as investors assess both market conditions and airline fundamentals. It is also one of the largest recent disposals involving THAI stock.
Ultimately, the transaction will provide an important indication of international investor confidence. Equally, it will offer insight into sentiment towards the wider aviation sector. That sector now faces soaring fuel costs, route reductions and continued uncertainty over future supply conditions.
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Further reading:
Government to reopen Hua Hin to international flights as it pushes Thai Airways on more flights
Thai Airways suffers turbulence in the boardroom as government exercises powers to appoint directors
Thai Airways union protests government ‘interference’ in its recovery plan at a critical juncture.
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Thai Airways to refloat on Stock Exchange in June 2025 with a renewed mission as national carrier
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