Key investment points
Epidemic tracking: the global epidemic continues to break out, and the input pressure of overseas epidemic increases.] At present, the national vaccination volume has exceeded 2.9 billion doses, and the vaccine population coverage rate has reached 89.63%.
Aviation: the aircraft fleet of civil aviation increased by 4.5% in 21 years, and the demand of the three major airlines recovered to 50% in 19 years. ① Supply: in 2021, 26 aviation companies of civil aviation net introduced 165 aircraft, the scale of mainland civil aviation fleet was 3827, and the growth rate of civil aviation fleet was 4.5%. The three listed airlines, spring and autumn and Jixiang net put in 82 aircraft, with a fleet growth rate of 3.3%. Air China Limited(601111) introduced 32 aircraft throughout the year, ranking first in the industry. In 2021, ask of the three major airlines increased by 0.8% year-on-year and recovered to 58% in 19 years. In December, ask of the three major airlines was – 29% year-on-year, recovering to 48% in 19 years. ② Demand: in 2021, the RPK of the three major airlines was – 1.3% year-on-year, recovering to 50% in 19 years, of which the internal demand recovered to 75% in the same period in 19 years. In December, the RPK of the three major airlines was – 36% year-on-year, recovering to 37% in the same period of 19 years. Among private airlines, the RPK in spring and autumn / Jixiang 21 was + 14% / + 16% respectively year-on-year, recovering to 87% / 78% in the same period in 19 years. In spring and autumn / auspicious December, RPK recovered to 66 / 60% of the same period in 19 years respectively. ③ Seating rate: the seating rate of the three major airlines was 69.41% (year-on-year -1.46pp) in 2021 and 82% in 19 years. The spring and autumn / auspicious seating rates were 82.87% (year-on-year + 3.2pp) / 75.65% (year-on-year + 0.46pp). ④ Oil remittance: the price of crude oil continued to rise, and the oil distribution center in Q4 in 21 years was USD 79.66. ⑤ Actual flight volume: daily average of 9437 flights in January, a year-on-year increase of – 13%.
Tax exemption: in 21 years, the sales volume of Hainan duty-free commerce department was 60.2 billion and that of the Customs was 49.5 billion. South Korea’s tax-free sales are expected to be nearly 100 billion, and more than 80% are sold to China. It is estimated that there will be 57 million overnight tourists in Hainan in 21 years, with a year-on-year growth rate of no more than 5%, 84% of the same period in 19 years. In 21 years, the passenger throughput of Meilan Airport was 17.52 million, about 72% of that in 19 years. The duty-free sales volume of Hainan outlying islands according to the customs standard was 49.5 billion yuan, a year-on-year increase of 80%, and the unit price of Q4 was 7366 yuan; The total sales volume of duty-free shops of Hainan Department of commerce is 60.2 billion. As of January 22, the number of duty-free store brands has exceeded 720, and the share of boutique products has gradually increased.
Hotel: RevPAR recovered to 70% in 19 years in 21 years. China: as of December 2021, the overall room supply-demand gap was 534 million, an increase of 11% month on month. The expansion of hotel supply-demand gap in second tier cities accelerated, and the income of rooms below the second tier accounted for 73% of the overall medium and high-end economy. From the operating data, the overall OCC in December was 51% higher than that in November. The ADR in that month was only 0.2% lower than that in the same period in 2020. The RevPAR was 208 yuan, about 70% of that in 19 years. Global: according to STR statistics, the OCC performance of various countries in the week of new year’s day of 22 was different. Japan took the lead, accounting for 62%, China slightly reached 50%, and Germany took the bottom. OCC in the United States was 53.7%, ADR reached US $157.91, an increase of 9% compared with the same period in 2019.
Investment strategy:
① aviation: in 22 years, the aviation company is expected to achieve single month or quarterly profit and loss balance, and pay attention to the nodes with upward demand. During the “14th five year plan” period, the growth rate of aircraft fleet size in the aviation industry is expected to be less than 6%, and the compound growth rate of demand in the same period is 5.9%. Civil aviation will usher in the improvement of supply and demand structure in the medium term; If the international line is liberalized at the end of the year 22, the daily utilization rate of aircraft will be effectively improved and the turnover efficiency will be greatly improved. At that time, the profitability of the airline company will have great room for improvement. The market-oriented reform of air fares has continued to deepen, the production capacity of first tier airports has expanded, the profit structure of civil aviation has been optimized, and the volume and price of high-quality routes have increased simultaneously, opening up room for single machine profits. Private airlines expanded significantly during the epidemic period. Through fine operation, it is expected to convert the fleet size and time resources into operating 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) . At the same time, we are also optimistic about the high performance elasticity of the three airlines in the recovery cycle.
② tax exemption: the growth rate is expected to be lowered in an all-round way, the pessimism is fully released, and the opportunity to exceed the expectation of the tax exemption sector in 22 years is sought. The epidemic situation promotes the restructuring of the tax-free industry, and the channel bargaining power is highly related to the flow and toughness; Under the guidance of scale, the absolute value of revenue and profit is more important than the net interest rate for duty-free businesses in Hainan. In the future, it can be seen that the category structure will shift from incense and chemical to high-quality products with higher customer unit price; The current passive price war in the outlying island duty-free market helps to improve the global price competitiveness of Hainan duty-free. We are optimistic that Hainan duty-free will still maintain a high growth after the recovery of international traffic. We focus on Meilan Airport, which has the resonance between production capacity and demand cycle.
③ Hotels: the medium and high-end are upgraded into the second half, and the products produced by differentiation are purchased 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 light assets and weakened the cyclical fluctuation. In the post epidemic period, the hotel industry is expected to open the revenue upward cycle driven by house prices under the new pattern: we are optimistic about the performance release elasticity of Shanghai Jin Jiang International Hotels Co.Ltd(600754) with the highest proportion of medium and high-end brands after brand integration, and recommend Huazhu group, a private wine management leader with excellent operation ability. At the same time, we are optimistic about the brand strength of Zhejiang Ssaw Boutique Hotels Co.Ltd(301073) in the medium and high-end hotel market and the possibility of leapfrog development through extension M & A in the future.
Risk tip: the sharp decline in macroeconomic growth and the repeated epidemic in a large area have seriously affected travel demand and the safety operation risk of the aviation industry.
