Core view
Two week performance of the plate:
In the past two weeks (November 29, 2021-december 10, 2021), the CSI 300 rose 4.01%, the gem index fell 0.06%, and leisure services The (Shenwan) index rose 6.23%, with a relative return of 2.22% compared with CSI 300, ranking third among Shenwan’s 28 sub industries. In terms of molecular plates, the scenic spot plate increased by 0.04% in recent two weeks, the hotel plate increased by 4.14% in recent two weeks, the tourism comprehensive plate increased by 7.64% in recent two weeks, the catering plate increased by 5.34% in recent two weeks, and other leisure services plate increased by 5.70% in recent two weeks.
Weekly tracking of individual stocks: 1) in terms of the rise and fall of individual stocks, the five stocks with the highest share price increase in the past two weeks are Tongdao Liepin / Helen company / China Tourism Group Duty Free Corporation Limited(601888) / Renrui talent / Jiangsu Tianmu Lake Tourism Co.Ltd(603136) ; 2) In terms of capital flow, in the past two weeks, China Tourism Group Duty Free Corporation Limited(601888) / Songcheng Performance Development Co.Ltd(300144) showed capital inflow to the north, and Shanghai Jin Jiang International Hotels Co.Ltd(600754) / Btg Hotels (Group) Co.Ltd(600258) / Caissa Tosun Development Co.Ltd(000796) showed capital outflow to the north. In terms of the subject matter of Hong Kong stocks, Naixue’s tea / Haidilao in the past two weeks showed an inflow of funds going south, and Xiapu Xiapu / jiumaojiu showed an outflow of funds going south.
Industry highlights: 1) in the first nine months of 2021, the duty-free sales of Hainan outlying islands increased by 121%, reaching 35.5 billion yuan. 2) The T2 duty-free shop of China free Haikou Meilan Airport was grandly opened. 3) Haikou Meilan International Airport Phase II expansion project is put into operation with an outlying island duty-free shopping area. 4) The Ministry of culture and tourism has released a list of 14 pilot areas for credit economic development in the cultural and tourism market. 5) Guangdong and Zhejiang suspended inter provincial team tourism and “air ticket + Hotel” business
Important announcements of A-share catering and Tourism Listed Companies: 1) Jinjiang International absorbs and merges Jinjiang capital; 2) Mr. Xia min, vice president of Shanghai Jin Jiang International Hotels Co.Ltd(600754) resigned; 3) Ctrip tourism information and Ctrip computer signed the share transfer agreement; 4) China waives the suspension of the process of this H-share issuance and listing.
Suggested combination this week: China Tourism Group Duty Free Corporation Limited(601888) , Btg Hotels (Group) Co.Ltd(600258) , jiumaojiu.
Investment proposal and investment object
In the past week, although Omicron virus is still spreading in many countries around the world, preliminary research shows that its symptoms may be more “mild” than Delta, overseas market concerns have weakened, and US stock hotels, OTAs, airlines and so on rebounded. Superimposed on the recovery of consumption style and the catalysis of the restless market in the Spring Festival, the A-share social service sector also ushered in a rebound. This week, we released the 2022 annual strategy report of the social service industry. We believe that the uncertainty of the epidemic situation next year may still disturb the industry boom and recovery rhythm. Although the probability of China’s epidemic prevention policy became stricter before the Winter Olympic Games, the market expectation is becoming more and more sufficient. At this time, we can start to be appropriately optimistic about the sector. In addition, we also suggest to seize the opportunity of individual stocks to make up for the rise in the turbulent market during the Spring Festival.
Duty free: the darkest hour has passed, so there is no need to be overly pessimistic. The tax exemption continued to be high throughout the year, but many factors led to large fluctuations in Q3 gross profit margin. We need to emphasize again that the repeated epidemic situation is still the primary factor affecting the tax-free prosperity of outlying islands, and the main reason for the increase of promotion and online sales is also to hedge the decline of passenger flow. Looking forward to 2022, the short-term repressive factors such as passenger flow are expected to improve marginally. The two major key projects of xinhaigang and land 2 of Haitang Bay phase I are worth looking forward to. There is no need to be overly pessimistic about the gross profit margin and competition pattern in the medium and long term, and continue to be optimistic about the long-term growth of the leader. It is recommended to pay attention to China Tourism Group Duty Free Corporation Limited(601888) (601888, overweight).
Hotels: continue to be optimistic about the optimization of supply pattern and leading growth. Since this year, although several rounds of epidemics have led to a lower than expected pace of industrial recovery, the leading enterprises have continued to open stores rapidly, single hotels have continued to be cleared, and the logic of supply pattern optimization has been continuously verified. Looking forward to 2022, there is still much room for improvement in China’s hotel chain rate and industry concentration compared with developed countries. We continue to be optimistic about the growth brought by the opening of leading stores against the trend and the upgrading of medium and high-end. The improvement of the epidemic in Europe is also expected to reduce the drag of overseas business on performance. It is recommended to pay attention to Btg Hotels (Group) Co.Ltd(600258) (600258, buy), Huazhu group-s (01179, not rated)
Tourism and scenic spots: the recovery trend remains unchanged, or there are opportunities for reversal. With several rounds of epidemic disturbance since June, the progress of China’s tourism recovery has shown a trend of high before and low after. Inter provincial travel and long-distance travel are still limited by epidemic prevention policies, and the performance of sector companies is generally under pressure. Looking forward to 2022, even if the demand side fluctuation is still inevitable, we still maintain confidence in the recovery trend. At the same time, the change of epidemic prevention policy is expected to ferment, which is also expected to give birth to the reversal opportunity of the plate market ahead of the fundamentals. It is recommended to pay attention to Songcheng Performance Development Co.Ltd(300144) (300144, buy), China Cyts Tours Holding Co.Ltd(600138) (600138, buy), Jiangsu Tianmu Lake Tourism Co.Ltd(603136) (603136, overweight), Wuhan Sante Cableway Group Co.Ltd(002159) (002159, buy)
Catering: according to channel research, Haidilao In November, the same store of jiumaojiu (Taier) and hailun company recovered to 70%, 80% and 90% in the same period of 19. Under the influence of the spread of multi-point epidemic, the passenger flow is still restrained, but the recovery speed of various brands is gradually widening the gap. Based on the long-term development tone of “cost-effective products + space + service” instead of the sinking market night entertainment demand, “accelerate the establishment of stores + highly standardized operation + strong brand potential” For the medium-term growth logic and the short-term business resilience of leading peers in the recovery level during the epidemic, we suggest paying attention to Helen (09869, Unrated), the leader of chain pubs, and jiumaojiu (09922, Unrated), which has a stable single store model and multi brand incubation potential.
Risk statement
Systemic risks, sudden factors, individual stock mergers and acquisitions do not meet expectations, etc
