Event:
The State Council has issued the tourism development plan for the 14th five year plan. The plan proposes that by 2025, the development level of tourism will be continuously improved, the modern tourism system will be more perfect, the effective supply, high-quality supply and flexible supply of tourism will be more abundant, and the consumption demand of mass tourism will be better met. The foundation of epidemic prevention and control is stronger, and the requirements of scientific and accurate prevention and control are fully implemented in the tourism industry. China's tourism is booming, inbound and outbound tourism is advancing in an orderly manner, the international influence and competitiveness of tourism are significantly enhanced, and significant progress has been made in the construction of a tourism power.
Key investment points:
Suppressed by the covid-19 epidemic and prevention and control policies, the tourism market performance in 2021 was weak: affected by the multi-point outbreak of the epidemic, China's tourism performance in 2021 was poor, and the expected "retaliatory growth" of the market did not come. According to the estimation of the Ministry of culture and tourism, 515 million people traveled during the golden week of November 2021, a year-on-year decrease of 1.5%, only recovering to 70.1% of the same period before the epidemic; China's tourism revenue was 389.061 billion yuan, a year-on-year decrease of 4.7%, only recovering to 59.9% in the same period before the epidemic. Inbound and outbound tourism has not recovered. Since the Civil Aviation Administration began to implement the international flight circuit breaker measures on June 8, 2020, the circuit breaker instructions have been issued continuously in 2021, and international flights have been cancelled frequently. According to the current epidemic prevention policy, foreign immigrants not only need about 7 days of self-health monitoring before entering the country, but also need to face an isolation period of more than 21 days after entering the country. Strict epidemic prevention and control measures make residents extremely cautious about the decision-making of cross-border travel, and the entry-exit travel is almost at a standstill. China's civil aviation has entered a cold winter. In 2021, it has been hit by the call of "local new year" in February, the epidemic situation at Nanjing airport in August and the epidemic situation in many places in November. The monthly passenger volume has repeatedly hit a new low.
In 2021, the leading performance of the tourism industry was poor, and the share price generally fell: 1) tax exemption:
Although the share price of China Tourism Group Duty Free Corporation Limited(601888) rose strongly from the second half of 2020 to the beginning of 2021, benefiting from the significant liberalization of the tax exemption policy for outlying islands in July 2020, due to the severe situation of the epidemic abroad, the downturn of the tax exemption business of China free airport and the impact of the multi-point outbreak of the epidemic in China, the growth rate of tax exemption for outlying islands slowed down, resulting in the poor performance of China Tourism Group Duty Free Corporation Limited(601888) in the second half of 2021.
Dragged down by the performance, the share price of China free has fallen all the way from the highest point in 21 years, almost halving. 2) Scenic spots: affected by the outbreak of epidemic in many places in China, provinces suspended inter provincial tourism business for many times in 2021, the passenger flow of Chinese scenic spots decreased greatly, and the share price of the leading scenic spot Songcheng Performance Development Co.Ltd(300144) fell by nearly 20% in 2021. 3) Travel Agency: the inbound and outbound tourism market is weak, and the share price of Caissa Tosun Development Co.Ltd(000796) 2021, which is mainly engaged in transnational tourism, fell, almost halving. 4) Hotels: Chinese hotels are also impacted by the reduction of business travel activities and the decline of Chinese passenger flow. In 2021, hotel OCC and RevPAR did not return to the pre epidemic level. However, during the epidemic period, the industry accelerated integration, hotel leaders such as Btg Hotels (Group) Co.Ltd(600258) , Shanghai Jin Jiang International Hotels Co.Ltd(600754) accelerated the pace of opening and expansion, and raised investors' expectations for future performance. In 2021, the share prices of Btg Hotels (Group) Co.Ltd(600258) and Shanghai Jin Jiang International Hotels Co.Ltd(600754) rose instead of falling.
The introduction of policies supports the high-quality development of the industry and injects a booster into the development of the tourism industry: Recently, China's economy is facing strong downward pressure and the performance of the tourism market is depressed. This time, the State Council issued the tourism development plan for the 14th five year plan, hoping to take advantage of the advantages of wide coverage, strong driving force, high openness and "one industry prospers all industries" to stimulate domestic demand and promote national economic growth. The introduction of the plan is expected to become a strong agent for the development of the tourism industry by alleviating the difficulties faced by the tourism industry, supporting the development exploration of market players and increasing the cultivation and development of the tourism market. If the epidemic situation in China is gradually stabilized this year, the restrictions on cross provincial and cross-border travel are gradually liberalized, and China's economic recovery and consumption pick-up are superimposed, the leading stock prices in the tourism industry are expected to achieve a positive result of performance growth and valuation return.
Investment suggestions: 1) tax exemption: the plan proposes to improve the service level of shopping departure tax rebate, expand the coverage of shopping departure tax rebate policy, and encourage more merchants to voluntarily become tax rebate stores to enrich the types of goods. Improve the tax-free industry policy system and promote the healthy and orderly development of China's tax-free industry. It is suggested to pay attention to the tax-free leaders who benefit from the recovery expectation and policy support of inbound and outbound tourism; 2) Scenic spot: the plan proposes to build core vacation products and high-quality performing arts projects, develop characteristic cultural and creative products and tourism commodities, enrich night cultural tourism products, set off the overall cultural landscape and strong vacation atmosphere, and cultivate world-class tourist resorts based on national tourist resorts and major vacation projects, It is suggested to pay attention to the leading scenic spots of theme parks that benefit from the recovery of passenger flow and consumption under the normalization of epidemic situation; 3) Travel Agency: the plan proposes to orderly promote inbound tourism and steadily develop outbound tourism; On the premise that international personnel exchanges return to normal, we will support qualified Chinese tourism enterprises to "go out" with Chinese tourists and build an overseas tourism reception network. It is suggested to pay attention to the head travel agencies that benefit from the expected recovery of cross-border travel; 4) Hotel: during the epidemic period, the industry supply was cleared, the leading enterprises accelerated their expansion, and the market share increased. Therefore, the share price of the leading hotels increased more. At present, the high valuation takes some time to digest, but the logic of long-term industrial structure upgrading and concentration upgrading remains unchanged. It is suggested to pay attention to the Leading Hotels with long-term competitiveness.
Risk factors: the risk of repeated epidemic, the risk of less than expected policy promotion, and the risk of less than expected tourism recovery.
