2021-10-27 Soochow Securities Co., Ltd. Tang Jun, Li Yuzhe and Song Xiaowen studied the first Travel Hotel and released a research report "comments on the third quarter of 2021: the epidemic has repeatedly led to operating pressure, and the performance is basically in line with market expectations." this report gives a buy rating to the first Travel Hotel, and the current share price is 25.05 yuan.
First Travel Hotel (600258)
Main points of investment
Revenue is solid, and Q3 performance is under pressure due to repeated outbreaks. The company's 2021Q1-Q3 revenue is 4.726 billion yuan (yoy+32.15%) and its mother's net profit is 125 million yuan (yoy+122.54%). Due to repeated epidemics in many parts of the country from July to September this year, the company's business was greatly affected by the sharp drop in travel demand. 2021Q3's single-quarter revenue was 1.582 billion yuan (yoy-5.38%), the return net profit was 60 million yuan (yoy-57.25%), and the non-return net profit was 44 million yuan (yoy-66.66%). Sub-business situation: the total profit of 2021Q1-Q3 Company is 165 million yuan (yoy+124.4%), of which the total profit of hotel business is 58.5 million yuan (yoy+108.4%), and the total profit of scenic spot operation is 107 million yuan (yoy+347.4%); the total profit of 2021Q3 hotel in a single quarter is 65 million yuan, and the total operating profit of scenic spot is 2.53 million yuan, which is-57.7% and 91.9% respectively compared with the same period last year.
RevPAR returned to about 70% of the same period in 2019, and budget hotels performed better overall. 1) overall caliber: RevPAR of all hotels in 2021Q3's first brigade home is RMB 124 (yoy-0.6%, is-29.3% higher than that of the same period in 2019, mainly due to a sharp drop in RevPAR in August under the influence of the epidemic). The RevPAR of mid-and high-end / budget hotels is 166 / 108RMB, respectively, and recovers to 65.1% / 71.1% in 2019, respectively. The recovery of budget hotels is better. The overall average room price (ADR) of 2021Q3 is 201 yuan (yoy+12.4%), and the overall occupancy rate (OCC) is 61.7% (yoy-8.1pct), which is lower than that of the same period in 2019, of which the OCC of mid-and high-end / budget hotels is 59.9% and 65.0% respectively. 2) mature store caliber: there are 3451 mature stores in 2021Q3 (more than 18 months after opening), and RevPAR is 126 yuan (yoy-3.6%, is-31.9% compared with the same period in 2019), of which the mid-and high-end / economy stores are respectively 171 / 108 yuan (yoy+10.1%), of which the economy store is + 11.1% compared with the same period last year; the overall OCC of mature stores is 63.0% (yoy-9pct, compared with the same period in 19 years-21.3pct).
The number of newly opened hotels has reached a new high, with a continuous layout of the middle and high-end market. By the end of September 2021, the company had 5455 hotels (including 1 overseas), of which 1312 were medium-and high-end hotels, accounting for 24.1%, and 143,000 rooms, accounting for 31.3% of the total. 2021Q1-Q3 opened 833 stores, of which 325 were opened in the third quarter, including 206 new mid-end / economy / light management hotels. By the end of September 2021, the company has signed a total of 1838 reserve projects that have not been opened or are in the process of signing, an increase of 239 over 2021Q2. In addition, the company launched the first Brigade Global purchase platform in September, and the first Brigade Noan Hotel Management Company was established in October, and the diversified business is expected to increase its performance in the medium to long term.
The overall expense rate decreased slightly in the first three quarters, and the month-on-month performance was weak. 2021Q1-Q3 company sales expense rate 5.2% (year-on-year-0.8pct), management expense rate 10.9% (year-on-year-1.8pct), expense rate improvement is mainly due to revenue growth; financial expense rate of 8.4% (year-on-year + 6.6%), mainly due to the implementation of new lease standards to recognize lease debt financing costs, with a gross profit margin of 28.2%. The single-quarter sales expense rate of 2021Q3 is 5.4% (month-on-quarter + 0.6pct), and the management expense rate is 11.1% (year-on-year + 2 pct), mainly due to the repeated revenue decline under the epidemic.
Profit forecast and investment rating: looking forward to 2021Q4, we believe that the industry is still in a continuous recovery cycle, and the company's performance is expected to show greater flexibility under the sound epidemic. At present, the company still maintains the guidance of 1400 new stores for the whole year. We maintain our previous profit forecast, and we expect the company's 2021-23 return net profit to be 4.2pm 1.38 billion yuan. 2021-23 year-on-year net profit growth of 184.4%, 166.4%, 23.6%, the current stock price corresponding to the dynamic PE 57, 22, 17 times, maintain the "buy" rating.
Risk hint: the epidemic repeatedly causes macroeconomic fluctuations, industry competition aggravates the risk, and hotel operation-expansion is lower than our expected risk.
A total of 29 agencies have rated the stock in the last 90 days, including 20 buy ratings and 9 overweight ratings; the average institutional target price in the past 90 days is 29.77; according to the Securities Star valuation analysis tool, the first Travel Hotel (600258) good company has a rating of 2.5 stars, a good price rating of 2 stars and a comprehensive valuation rating of 2.5 stars.