The recovery is expected to embrace Pro cyclical and service consumption growth. The trend of social service sector throughout the year is closely related to the epidemic situation. The epidemic situation stabilized in 2021q1, driven by spring festival consumption, and social service outperformed the market; In 2021q2-q4, local epidemics occurred one after another throughout the country, and policy tightening & consumer demand suppression impacted the social service sector. The central economic work conference released the expectation of maintaining stability, stressed that “stability comes first and seek progress in stability”, and the expression of counter cyclical regulation reappeared, which is expected to provide policy support for the subsequent recovery of the consumer industry. Looking forward to 2022, with the steady epidemic prevention and control and the continuous improvement of the industry boom, we are optimistic about the marginal improvement brought by the medium-term recovery and the high-quality service consumption sector with great upward flexibility, such as catering, hotels, scenic spots, Ota, outbound tourism, etc. In the long run, the gold digging potential of Pro cyclical service consumption is large. Under the impact of the epidemic, it highlights the leading core value. It is suggested to stick to the leading stocks in the high-quality track.
Optimistic about the bottom performance elasticity brought by the recovery of demand after the epidemic, and firm layout of consumption leaders for a long time.
1) Catering: the chain wave is still surging, and the willows are waiting for the flowers. In 2021q3, the company’s zero catering revenue reached 1.1 trillion yuan (YoY + 4.0%), recovering to 97.8% in the same period in 2019. In October 2021, the company’s zero catering revenue was 446 billion yuan (YoY + 2.0%), including 97.6 billion yuan for catering enterprises above designated size (YoY + 4.0%), the revenue performance is better than the whole. Looking forward to the future, the repeated epidemic situation is still the biggest uncertainty in the industry. Euromonitor expects that China’s dining out rate will gradually rise, reaching 38.7% by 2025. In 2020, the chain rate of China’s catering industry will only be 17.4%, and the average chain rate of developed countries will reach 47.2%. In the long run, the trend of industry branding & chain is still accelerating, and the leading enterprises are expected to continue Continued benefits. With the continuous and steady epidemic prevention and control, we are optimistic about the upward flexibility of the performance in the epidemic era after the catering leader. We mainly recommend jiumaojiu, Haidilao in the medium and long term, and we suggest paying attention to Helen’s, Naixue’s tea and Yum china-s. The catering supply chain is highly related to the catering performance. We are optimistic about the catering supply chain opportunities under the general trend of catering industrialization. We suggest paying attention to Yihai Kerry Arawana Holdings Co.Ltd(300999) , nongnongshan spring and Yihai international.
2) Hotel: the contradiction between supply and demand is prominent, and the layout of the leading enterprises is accelerated to recover in a pro cyclical manner. According to yingdie consulting, in 2020, the number of hotel facilities / other accommodation facilities in China will be reduced by 59000 / 102000 respectively. Single hotels or small and medium-sized hotels with weak profitability will be shut down under the impact of the epidemic. The chain hotel leaders Jinjiang, Huazhu and BTS expanded against the trend during the epidemic period with the advantages of scale, brand, member resources and capital. In 2020, the market share of Jinjiang, Huazhu and BTS in terms of hotel rooms will reach 20.2% / 13.9% / 9.2%, totaling 43.3%. With economic growth and consumption upgrading, the proportion of medium and high-end hotels has increased year by year and has become the main force of industry development. The epidemic accelerated industry integration and chain rate. With the smooth progress of the vaccine, the superposition of Pro cyclical economic recovery and the recovery of business travel demand, the recovery of hotel performance after the epidemic is expected. It is recommended to Shanghai Jin Jiang International Hotels Co.Ltd(600754) , Btg Hotels (Group) Co.Ltd(600258) . It is recommended to pay attention to Huazhu group-s.
3) Culture and Tourism: the demand has gradually warmed up, and we look forward to the improvement of prosperity after the epidemic. Under the trend of the epidemic situation, local consumption & surrounding tourism is booming, and the advocacy of “local new year” in some provinces and cities is expected to release the potential of local consumption. The quick reaction ability of enterprises under the epidemic situation will determine whether they can adapt to survive under the new normal of repeated local epidemics. By the end of November 2021, the global vaccination volume had reached 8.07 billion doses. The United States reopened its door on November 8. We expect that Australia, Germany, France, Singapore and other countries will gradually liberalize border control, and overseas cultural tourism is expected to continue to benefit. It is suggested to pay attention to Fosun tourism culture, Caissa Tosun Development Co.Ltd(000796) , Utour Group Co.Ltd(002707) . In terms of structure, we believe that the consumption potential and demand of residents’ culture and tourism are still strong. With the continuous rise of China’s vaccine coverage, the performance elasticity of high-quality targets is sufficient and has layout value. Recommend Songcheng Performance Development Co.Ltd(300144) , Jiangsu Tianmu Lake Tourism Co.Ltd(603136) , and pay attention to Tongcheng Yilong, Ctrip group-s, China Cyts Tours Holding Co.Ltd(600138) .
Risk warning: there may be risks such as the continuous spread of the epidemic, macroeconomic fluctuations and policy changes; There may be a risk of fierce industry competition; There may be risks that the progress of business transformation, market development and capacity improvement is lower than the market expectation.
