\u3000\u3 Guangdong Shaoneng Group Co.Ltd(000601) 888 China Tourism Group Duty Free Corporation Limited(601888) )
China's duty-free market is a blue ocean, and China Tourism Group Duty Free Corporation Limited(601888) is the absolute leader. China's tax-free market has long-term growth potential, driven by the return of consumption and the expansion of medium and high-end income groups. It is estimated that the scale of China's duty-free market is expected to be nearly 100 billion yuan in 22 years. There is a trend to liberalize tax-free licenses, but it will still maintain a limited competition pattern, China Tourism Group Duty Free Corporation Limited(601888) is the absolute leader, with a market share of more than 90% in 20 years, with obvious first mover advantage.
The trend of multi-channel recovery is gradually rising, and the company enjoys the growth dividend of the industry. Continuous volume of tax-free channels on outlying islands: the improvement of the short-term epidemic and the recovery of tourism industry drive the sales growth, and the long-term policy guidance and the release of market vitality jointly drive the continuous volume of channels. As an absolute leader of tax-free operators on outlying islands, the company's outlying island business is expected to continue to grow. The opening-up of entry-exit will bring about the recovery of port duty-free business: the port duty-free channel has the advantage of natural passenger flow and is of high importance. In the first half of the year, the number of people entering and leaving China was only 19.5% of that in the same period of 19 years. The port duty-free recovery space brought by the liberalization of entry and exit is huge. The company has mastered most of the core tax-free strongholds of ports in China and will fully benefit from it. There is a huge space for the policy of opening stores to Chinese people in the city: the policy of duty-free opening to Chinese people in the city will probably be implemented after the global epidemic improves and entry-exit completely recovers. The company has arranged duty-free shops in many places in China or reached cooperation agreements to lay the foundation for the release of future performance.
Comprehensively improve operation capability and create core competitive advantage. In terms of management, the excellent management team led the company to continue to lead the industry, with superior shareholder background, providing resources for the development of the company. In terms of supply chain, multi brand cooperation and centralized procurement helped improve product competitiveness. By the end of the 20th year, the company had established cooperative relations with nearly 1000 well-known brands around the world. In terms of service, the number of members increased from 400000 in 18 years to 12 million at the end of 20 years. The combination of hierarchical membership system and precision marketing contributed to sales. In terms of channel construction, the effect of online platform integration is beginning to show, and it is expected to continue to contribute to stable revenue in the future.
Benchmarking dufry to see the company's long-term development, global expansion opens the growth ceiling. Dufry is a leading travel retailer in the world. Through acquisition, dufry has expanded its territory around the world, bringing all-round improvements in sales, brand cooperation, procurement cost and operation ability. China tax exemption is also gradually exploring the international market, and the proportion of overseas tax-free channel revenue has increased. It plans to go to Hong Kong for listing or to further expand overseas channels. The Asia Pacific region may be the main short-term goal of the company's overseas expansion, and it is expected to achieve global layout in the long term.
Profit forecast and investment rating: the company has a leading edge in the tax-free market and will fully enjoy the growth dividend of the industry. It is estimated that the net profit from 2021 to 2023 will be RMB 9.57/133.1/17.467 billion, corresponding to EPS of RMB 4.9/6.82/8.95 and PE of 41 / 30 / 23 times. Maintain a "strongly recommended" rating.
Risk tip: macroeconomic fluctuations, unexpected policies, repeated outbreaks in China, and intensified tax-free competition on outlying islands
