Hotel: counter trend expansion + cost reduction and efficiency increase, leading toughness highlights under fluctuations, and it is expected to benefit more after the industry recovers
2021: on the business side, the RevPAR of the top three domestic enterprises recovered to 83.0% in 19 years on average, higher than 24.3pct of the industry. Jinjiang and Huazhu took the lead in the first travel by 10 + PCT, and continued to expand against the trend. On the revenue side, Huazhu’s RevPAR recovery + store opening speed is relatively excellent, with a relative lead of + 25.4% in the whole year. The profit side has significantly reduced losses. Due to the high proportion of direct sales, the first brigade has a more flexible release of profitability in the warmer quarter, supporting the turnaround of losses throughout the year; Due to its small and beautiful high-end positioning + entrusted management mode, Junting maintained profitability in a single quarter and deducted non parent net interest rate of 11.2% in the whole year, which was the most stable; The leader paid more attention to cost reduction and efficiency increase, the management expense rate of Jinjiang decreased by more than 2pct for two consecutive years, and the first brigade streamlined its structure and strengthened its digital investment. The overall cash flow improved, the capital structure continued to be optimized, and the interest bearing debt ratio of the industry increased from – 4.0pct to 29.3% year-on-year.
1q22: on the operation side, the epidemic situation in first tier cities worsened in March, and the RevPAR of Huazhu and Jinjiang still recovered to 74.2% / 72.6% in 19 years, higher than the overall 10 + PCT in China. Junting benefited from the high-end vacation demand of surrounding tourism, and the RevPAR recovered to 80% in 19 years; In terms of expanding stores, Huazhu increased the speed of expanding stores in the off-season (302 / + 93 new stores were opened and 20.2% of the annual plan was completed). The net growth of Jinjiang pipeline was the highest in a single quarter since 4q20. Junting plans to sign 100 new stores in the whole year. Under the epidemic, the head chain is more favored by investors and the industry integration is accelerated. On the performance side, the pressure is obvious due to the impact of the epidemic. Jinjiang benefits from a significant year-on-year recovery overseas, and 2q22 overseas repair is expected to speed up. Operation capacity, assistance policy for franchisees + long accounting period of isolated hotels, and the turnover efficiency of the industry has decreased. Catering: the leader cultivates internal skills and is ready to go. The food + catering mode has strong anti risk ability under fluctuation
Social zero Catering: it has recovered to the level of 19 years in 21 years, and 1q22 is under pressure again. Compared with 19 years ago, + 0.4% / + 10.5% of catering above the quota in the community in 21 years, the overall situation has recovered to the 19 year level. The epidemic recurrence in 1q22 is serious, and offline catering is still under pressure. Catering above the quota accounts for + 0.5% year-on-year, accounting for 24.8% / + 1.4pct. Branding and chaining are still the general trend
2021: on the performance side, the revenue is repaired and the expansion of stores is still the main driving force for growth. However, the encryption imbalance of some meal enterprises leads to losses in closing stores and increasing income without increasing profits, while the companies with rising brands, high degree of standardization and proper cost control (such as jiumaojiu and hailun) are relatively bright; On the expense side, the rigid pressure of Hong Kong stock catering brand personnel, rent and amortization expenses is still on, the profitability of A-Shares is also under pressure due to the rise of labor costs and changes in product structure, and the operating capacity and turnover efficiency have rebounded.
1q22: performance and operating efficiency are under repeated pressure due to the epidemic, while companies with relatively complete supply chain and quick-frozen / prefabricated vegetable business have stronger business resilience than ordinary catering under the epidemic.
Investment suggestions: 1) the hotel industry suggests paying attention to Shanghai Jin Jiang International Hotels Co.Ltd(600754) , Zhejiang Ssaw Boutique Hotels Co.Ltd(301073) , Huazhu group; 2) IX. suggestions on catering industry.
Risk tips: repeated global epidemic risk, exchange rate fluctuation risk, lower than expected operation quality of non-standard hotels, lower than expected expansion speed, price fluctuation of raw materials, etc.
