Basic conclusion
Look at history: macroeconomic fluctuations + supply and demand matching time lag form the industry cycle, and pmi-occ-adr is the general transmission path of the hotel industry cycle. From 2000 to 2019, China’s hotel industry experienced three major cycles: 1) from 2000 to 2008, the economy grew rapidly, the economy hotel started, the overall supply was in short supply, and the prosperity of the industry fell significantly under the financial crisis in 2008; 2) 1Q09 ~ 3Q10 revrar rose rapidly under strong demand recovery + weak supply growth, economic growth reached a new level, and the prosperity of 4q10 ~ 3q15 industry continued to be depressed after the economic market entered the Red Sea stage; 3) From 4q15 to 4q17, the economic growth picked up, and under the condition of consumption upgrading + marginal reduction of new supply, medium and high-end became the main driving force of RevPAR. After 1q18, the trade friction upgraded, OCC fell significantly, the industry boom entered the downward stage, and 4q19pmi showed year-on-year upward signs before the epidemic. From the medium and long-term perspective, the industry’s fixed asset investment peaked in 2015 and gradually entered the stage of stock integration; Supply and demand jointly promote the upgrading of mainstream hotels along the “full-service star hotels → limited service economy hotels → limited service medium and high-end hotels →…”.
Looking to the future: in the short term, the recovery elasticity and in the medium and long term, the concentration will increase. In the short term: supply clearing + cycle transmission is accelerated. Once it recovers, it is expected that the business indicators will be flexible. In addition to macro factors, the difference of individual recovery elasticity is also related to a variety of factors. The transmission of macro indicators – business indicators is affected by the micro main user structure, and the elasticity with high proportion of business travel and members / CRS is greater; The transmission of business indicators – performance indicators is affected by the direct business model and product structure. The high proportion of direct business, comprehensive takerate and medium and high-end are more flexible. In the medium and long term, the hotel industry has a strong scale effect. The four trends of asset light + medium and high-end + Chain + digitization jointly promote the improvement of industry concentration.
Investment advice
1H22 it is expected that the industry will be under pressure as a whole. In the case of repeated and serious outbreaks in China in the short term, it is suggested to pay attention to Shanghai Jin Jiang International Hotels Co.Ltd(600754) , which is relatively small affected by the epidemic in Shanghai, accounts for a high proportion of overseas business and is expected to turn around the loss, and benefit from peripheral tourism and the acquisition of Zhejiang Ssaw Boutique Hotels Co.Ltd(301073) , which is characterized by resort products.
As far as the recovery opportunities of the CRS sector are concerned, it is more flexible than the CRS sector in the future.
The trend of increasing the concentration of the hotel industry in the medium and long term is clear, and the internationalization opportunities can also be expected. It is suggested to pay attention to the three local dragon head Huazhu group, Shanghai Jin Jiang International Hotels Co.Ltd(600754) , Btg Hotels (Group) Co.Ltd(600258) . In addition, the demand for luxury hotels continues to be strong, and there is a certain scarcity of resort high-end hotels. It is suggested to pay attention to Zhejiang Ssaw Boutique Hotels Co.Ltd(301073) .
Risk tips
Repeated epidemic, cash flow pressure risk, goodwill impairment risk
