Summary of Spring Festival transportation data: the passenger volume of Spring Festival transportation in 22 years increased by 21% year-on-year and recovered to 35% in 19 years. During the 40 day spring festival transportation, the cumulative passenger volume of China was 1.05 billion person times, with a year-on-year increase of + 21%, of which the cumulative passenger volume of civil aviation was 39.53 million person times, with a year-on-year increase of + 12%. The passenger volume in the first half of the Spring Festival transportation increased by 30-40% year-on-year; However, in the latter half of the year, affected by the spread of the epidemic in many places across the country, the year-on-year growth rate decreased, or even negative growth.
During the 40 day spring festival transportation, the cumulative passenger volume in China was 1.05 billion, up + 21% year-on-year and down – 65% compared with the same period in 19 years. ① The cumulative passenger volume of civil aviation was 39.53 million person times, an increase of + 12% year-on-year and a decrease of – 46% compared with the same period in 19 years; ② The cumulative passenger volume of railway was 249 million person times, an increase of + 13% year-on-year and a decrease of – 39% compared with the same period in 19 years; ③ The cumulative passenger volume of highways was 752 million, up + 25% year-on-year and down – 69% from the same period in 19 years; ④ The cumulative passenger volume of waterways was 16.52 million, up + 7% year-on-year and down – 67% compared with the same period in 19 years.
During the Spring Festival, 250 million people traveled in China, which recovered to 74% in the same period in 19 years. Hotel OCC remained at a low level of 30%, and ADR rose sharply. During the 22-year Spring Festival holiday, the number of Chinese tourists recovered to 70% in the same period before the epidemic, mainly focusing on urban leisure and suburban vacation tourism. The Winter Olympic ice and snow culture also drives the wave of ice and snow leisure. The passenger flow of major popular destinations has recovered steadily, and the passenger flow of Sanya has recovered to 74% in the same period of 19 years. Chengdu Chongqing region ranks first in the passenger traffic volume of the airport. During the Spring Festival, the performance of hotels in Sanya rose by only about 90%, but the overall performance of hotels in Sanya surpassed that of OCC.
China’s dynamic zero clearing prevention and control policy will continue, and it is expected that civil aviation passenger transport will recover to 75 ~ 85% in 22 years. It is estimated that the full caliber passenger traffic volume in 22 years will recover to 60 ~ 70% in 19 years, and the civil aviation passenger traffic will recover to 75 ~ 90%; The passenger volume of Hainan reached 110 ~ 130% before the epidemic, and the passenger volume of Hainan civil aviation reached 90 ~ 110% before the epidemic.
Investment strategy:
Aviation: Fundamentals: even considering the 737max go around, the growth rate of China’s aviation industry fleet is expected to be only 4.5% and 3.8% in the next two years. There is high uncertainty in the contraction of supply growth. When the international line is fully liberalized and the industry enters a tight balance between supply and demand in the future, the profit center of the aviation industry will usher in a deterministic rise, Excellent private airlines such as Spring Airlines Co.Ltd(601021) are expected to surpass the profit peak of 25 million per unit. Valuation: at present, the market value of the single aircraft of the three major airlines + spring and autumn auspicious is 102133% of the base in 2019, reflecting the high degree of optimism of A-share investors about the profit potential and demand recovery of China’s aviation industry. The game attribute of the sector suppresses the excess income brought by the repair of fundamentals in the future. We believe that private airlines expanded against the trend during the epidemic period and are expected to convert the fleet size and time resources into business performance when the travel demand returns to normal. At the current time, we mainly recommend Spring Airlines Co.Ltd(601021) and Juneyao Airlines Co.Ltd(603885) , and are optimistic about the high performance elasticity of the three airlines in the recovery cycle.
Hotels: medium and high-end upgrade into the second half, and buy products produced by differentiation α。 The epidemic situation has accelerated the clearance of industries, and the chain rate has increased significantly (26 → 31%), but there is still room compared with 70% in the United States; During the epidemic period, the wine management group expanded against the trend and concentrated its share to the head, which helps to standardize the supply of the industry; The head company upgraded to medium and high-end, optimized the existing product structure, improved the overall profitability, overweight and light assets, and weakened the cyclical fluctuation. In the post epidemic period, the hotel industry is expected to start the revenue upward cycle driven by house prices under the new pattern: at the current time, the target Zhejiang Ssaw Boutique Hotels Co.Ltd(301073) of high-end resort hotels / medium and high-end hotels is mainly recommended. We are optimistic about the performance of Shanghai Jin Jiang International Hotels Co.Ltd(600754) with the highest proportion of medium and high-end hotels after brand integration, releasing flexibility, and recommend Huazhu group, a private wine management leader with excellent operation ability.
Risk tip: the sharp decline of macroeconomic growth and the repeated epidemic in a large area have seriously affected the travel demand and the safe operation risk of the aviation industry.
