The Zhitong Finance App learned that Anxin International released a research report saying that domestic tourism performance during the 2024 Spring Festival holiday exceeded expectations. Under comparable standards, tourism revenue/number of visitors increased 47%/34% year over year, up 7.7%/19% from the same period in 2019, which was better than the bank's previous expectations. The number of outbound visitors is close to the same period in 2019, and the degree of recovery for the whole year is expected to increase to 84% from 56% last year. The comparable amount of duty-free spending per person on the outlying islands of Hainan increased by 40%/66% year on year. Increased passenger flow and increased shopping conversion rates led to an increase in per capita duty-free consumption compared to National Day and New Year's Day. It is recommended to focus on Ctrip Group-S (09961) and Tongcheng Travel (00780), which are OTA targets with high predictability of steady growth in performance, and China's exemption (01880), which has the potential to recover performance.

Anxin International's main views are as follows:

Domestic tourism performance during the Spring Festival was better than expected, or boosted annual travel revenue expectations:

According to estimates from the Ministry of Culture and Tourism, domestic tourism revenue during the Spring Festival (2/10-2/17, 8 days) was 632.7 billion yuan, up 47%/7.7% from the same period in 2023/2019 according to comparable caliber (average daily data); the number of domestic tourists was 470 million, with a comparable caliber of 34%/19% higher than 2023/2019. The recovery trend accelerated from New Year's Day, and was better than the bank's previous expectations (500 billion yuan, 400 million visitors). The release of demand for long-distance travel drove per capita spending up 9%/3% year over year to 1,335 yuan compared to 2019, which is higher than the performance during the National Day holiday period (912 yuan). If we refer to the annual share of domestic tourism revenue during the Spring Festival before the pandemic (9%-10%), domestic tourism revenue is expected to reach 6-7 trillion yuan in 2024, exceeding the 2019 level, and also higher than the Ministry of Culture and Tourism's forecast for December last year (6 trillion yuan).

The resumption of outbound travel is speeding up:

According to data from the Ministry of Culture, Tourism, the number of outbound tourists during the Spring Festival was 3.6 million, close to the same period in 2019. In terms of destinations, the number of visitors from Hong Kong, China and Macau was 1.26 million/1.04 million (data released by the SAR government), accounting for 35%/29%, accounting for a total share of 64%. Compared with 1H23, 78%, regardless of Taiwan, this reflects an increase in the share of overseas travel. Overseas travel destinations are still mainly Southeast Asia/Japan/South Korea, and long-term destinations such as Europe/America have further recovered. The Ministry of Culture and Tourism expects the number of outbound visitors to reach 130 million in 2024, an increase of 49% over the previous year, recovering to 84% in 2019, compared to 56% in 2023. The impetus may be due to the continued restoration of international routes (63% in December last year to 2019), mutual visa exemption agreements, and the acceleration of the visa process.

The platform's travel order volume performance is impressive:

1) Ctrip: Domestic and inbound travel orders increased significantly year-on-year and exceeded 2019 levels. Domestic customized tour orders increased 5 times over the same period last year, and the customer unit price increased by 24%; “New Matai” travel orders increased by more than 30% compared to 2019. 2) Simultaneous travel: Flights/train tickets and hotel orders to popular domestic cities increased by more than 30% year-on-year. 3) Flying Pig: Domestic medium- and long-term orders increased more than 3 times year on year, customer unit price increased 10% year on year; outbound travel bookings increased nearly 10 times year on year. 4) Meituan: The scale of travel spending increased significantly year-on-year and compared to 2019, and overseas hotel reservations reached a record high. 5) Douyin: Travel and accommodation orders increased 130% year over year.

The duty-free market is gradually picking up:

According to Haikou Customs data, during the 2024 Spring Festival holiday, the amount of duty-free shopping on the outlying islands of Hainan was 2.5 billion yuan, a comparable increase of 40%/118% year over year in 2021. The number of shoppers was 300,000. The average number of shoppers increased 66% year on year. Duty free consumption picked up as passenger flow increased. The 2024 Spring Festival duty-free per capita consumption was 8,358 yuan, down 16% year on year, but increased 7%/16% from 2023 National Day (7,824 yuan) /2024 New Year's Day (7,228 yuan), showing a marginal improvement trend.

Risks: Weak spending power is dragging down travel spending; competition intensifies.