Core view
Korean duty-free stores: sales fell by less than US $1 billion in January, a year-on-year increase of – 22.73%. In January 2022, the sales of duty-free stores in South Korea fell back to the level of June 2020, with sales of only US $974 million (about RMB 6.157 billion) in that month, a year-on-year increase of – 22.73% and a month-on-month increase of – 16.39%. Among them, the sales volume of foreign tourists was 903 million US dollars, with a year-on-year increase of – 26.32% and a month-on-month increase of – 17.61%. The sales volume of Chinese tourists was 71 million US dollars.
The number of shoppers has not recovered to 20% before the epidemic, and the customer unit price is four times that before the epidemic. In January 2022, there were 651700 people shopping in duty-free stores in Korea, with a year-on-year increase of + 89.47 and a month on month increase of – 1.11%; Among them, 60400 people shopped in China and 51300 people shopped abroad; The customer unit price was US $149406, a year-on-year increase of – 59.22%, but 3.95 times that of the same period in 2019.
The epidemic situation in South Korea has worsened, and the dependence of duty-free on purchasing agents will continue. In January 2022, 81800 cases of covid-19 were newly confirmed in Seoul, Incheon, Busan and Jeju Island of South Korea, and 895100 cases were newly confirmed in February. At present, there are more than 130000 new cases in a single day in China.
5.82 billion yuan from Hainan Islands vs 6.16 billion yuan from South Korea. In January 2022, the total sales volume of 10 outlying island duty-free stores in Hainan was 5.822 billion yuan, a year-on-year increase of + 43.75%. Among them, the sales of duty-free goods was 5.345 billion yuan, a year-on-year increase of + 44.46%; The number of duty-free shoppers was 982900, a year-on-year increase of + 40.21%; The number of duty-free shopping items is 5.9262 million.
Investment suggestion: in the context of consumption return, China Tourism Group Duty Free Corporation Limited(601888) [ China Tourism Group Duty Free Corporation Limited(601888) . Sh] is the leader in the duty-free industry. With strong upstream procurement channels and obvious advantages in the scale of downstream stores, it is expected that the pattern of “one super multi strong” will be stable in the long term. In the short term, the company’s reduction in discounts combined with the expectation of the landing of new harbor duty-free city is expected to provide momentum for subsequent performance growth and boost the company’s long-term value.
Risk warning: repeated epidemic situation; Promotion discount rate fluctuation; Changes in immigration policies.
