Financial Performance - Revenue increased by 49.5% year-on-year to RMB 3,866.3 million for the three months ended March 31, 2024, compared to RMB 2,586.1 million in the same period of 2023[4] - Adjusted EBITDA rose by 12.0% year-on-year to RMB 820.2 million, with an adjusted EBITDA margin decreasing to 21.2% from 28.3%[4] - Adjusted net profit increased by 10.9% year-on-year to RMB 558.5 million, with an adjusted net profit margin decreasing to 14.4% from 19.5%[4] - Total revenue increased by 49.5% from RMB 2,586.1 million in Q1 2023 to RMB 3,866.3 million in Q1 2024[30] - Revenue from the core online travel platform rose by 23.9% to RMB 3,203.3 million, driven by increased demand for accommodation and transportation services[32] - Accommodation booking service revenue grew by 15.6% to RMB 964.7 million, while transportation ticketing service revenue increased by 25.6% to RMB 1,736.5 million[30] - The company reported a net profit of RMB 400.3 million for the three months ended March 31, 2024, compared to RMB 378.9 million for the same period in 2023[53] - Total comprehensive income for the period was RMB 399,626,000, up from RMB 365,701,000, reflecting a growth of 9.3% year-over-year[55] User Growth and Engagement - Average monthly paying users grew by 2.9% year-on-year to 42.6 million, while annual paying users increased by 14.3% to 229.3 million[4] - Total service users for the twelve months ended March 31, 2024, reached 1,826.7 million, a 57.4% increase year-on-year[4] - The company continues to expand its user base, with approximately 87% of registered users residing in non-first-tier cities in China[15] Business Development and Strategy - The company is implementing effective strategies to accelerate business development and expand market share in the growing Chinese travel market[14] - Future strategies include expanding the international footprint, enhancing hotel management and vacation business, and seeking investment opportunities aligned with strategic goals[27] - The company is focused on integrating Tongcheng Travel Group, which has approximately 500 travel agency outlets nationwide, to enhance its vertical expansion strategy[22] Revenue Streams - In Q1 2024, transportation ticketing service revenue increased by 25.6% year-on-year to RMB 1,736.5 million, driven by a surge in ticket volume and enhanced value-added products[19] - Domestic flight sales grew by 30% year-on-year, while international flight sales experienced over 260% growth, attributed to effective international expansion strategies[19] - Accommodation business revenue rose by 15.6% year-on-year to RMB 964.7 million, with domestic hotel room nights sold increasing by 10%[21] - International hotel room nights sold increased by over 150% year-on-year, supported by increased market investment and enhanced user interaction[21] - Other business revenue grew by 36.0% year-on-year to RMB 502.2 million, driven by strong performance in advertising, the Black Whale membership program, and hotel management[21] Cost and Expenses - Sales cost surged by 109.4% from RMB 645.3 million to RMB 1,351.5 million, with the sales cost as a percentage of revenue rising from 24.9% to 34.8%[35] - Service development expenses increased by 18.4% to RMB 486.8 million, with the proportion of these expenses to revenue decreasing from 15.2% to 11.9%[36] - Sales and marketing expenses rose by 41.6% to RMB 1,368.2 million, with the proportion of these expenses to revenue decreasing from 37.0% to 35.0%[37] - Administrative expenses increased by 38.0% to RMB 265.3 million, maintaining a proportion of 5.1% of revenue[38] Cash Flow and Assets - Cash and cash equivalents at the end of the period increased to RMB 7,780,784,000, compared to RMB 5,192,398,000 at the end of December 2023, representing a 50.0% increase[60] - The net cash generated from operating activities was RMB 484,472,000, down from RMB 874,187,000, indicating a decline of 44.7% year-over-year[60] - Non-current assets totaled RMB 17,108,523,000 as of March 31, 2024, compared to RMB 16,816,963,000 at the end of December 2023, showing a growth of 1.7%[57] - The total assets of the company reached RMB 33,673,317,000, an increase from RMB 31,716,609,000, reflecting a growth of 6.2%[58] - The company reported a significant increase in cash flow from investing activities, with a net cash inflow of RMB 1,235,615,000 compared to an outflow of RMB 190,922,000 in the previous year[60] Corporate Governance and Leadership - The board of directors consists of executive directors and independent non-executive directors, including the CEO Ma Heping[67] - The company is led by co-chairmen Wu Zhixiang and Liang Jianzhang, indicating a strong leadership structure[67] - The company is focused on strategic decision-making and governance through its board composition[67] - The presence of independent directors highlights the company's commitment to corporate governance and accountability[67] - The executive team includes experienced members, which may enhance operational efficiency and strategic execution[67] - The leadership structure may facilitate effective communication and decision-making processes[67] - The board's composition reflects a balance of executive and independent oversight, which is crucial for stakeholder confidence[67] - The announcement indicates ongoing corporate governance practices that align with market expectations[67]

Financial Performance - Annual revenue reached $2.5 billion, representing a 15% year-over-year growth[1] - Revenue increased by 80.7% year-to-year to RMB11,896.2 million in 2023 from RMB6,584.7 million in 2022[9] - Adjusted EBITDA increased by 117.4% year-to-year from RMB1,437.2 million in 2022 to RMB3,123.9 million in 2023, with the margin rising from 21.8% to 26.3%[9] - Adjusted net profit surged by 240.3% from RMB646.2 million in 2022 to RMB2,199.1 million in 2023, with the net margin increasing from 9.8% to 18.5%[9] - Net profit margin improved to 12%, up from 10% in the previous year[1] - Profit before income tax turned positive at RMB1,853.7 million in 2023 compared to a loss of RMB117.1 million in 2022[10] - Revenue for the year ended December 31, 2023, increased to RMB 11,896,244 thousand, up from RMB 6,584,666 thousand in 2022, representing a significant year-over-year growth[38] - Gross profit for 2023 reached RMB 8,738,211 thousand, compared to RMB 4,778,026 thousand in 2022, reflecting a strong improvement in profitability[38] - Operating profit for 2023 was RMB 1,869,365 thousand, a substantial recovery from an operating loss of RMB 24,190 thousand in 2022[38] - Net profit attributable to equity holders of the company for 2023 was RMB 1,554,131 thousand, reversing a loss of RMB 146,009 thousand in 2022[38] - Adjusted net profit for 2023 stood at RMB 2,199,101 thousand, compared to RMB 646,172 thousand in 2022, indicating a robust financial performance[38] - Total revenue increased by 80.7% from RMB6,584.7 million in 2022 to RMB11,896.2 million in 2023[41][42] - Adjusted EBITDA for 2023 was RMB 3,123.9 million, compared to RMB 1,437.2 million in 2022, reflecting a significant year-over-year increase[66] - Adjusted net profit for 2023 reached RMB 2,199.1 million, up from RMB 646.2 million in 2022, showing strong growth[70] - Operating profit for 2023 was RMB 1,869.4 million, a substantial improvement from an operating loss of RMB 24.2 million in 2022[66] - Profit attributable to equity holders of the company improved significantly, turning from a loss of RMB 146.0 million in 2022 to a profit of RMB 1,554.1 million in 2023[59] - Profit before income tax for 2023 was RMB 1,853.7 million, contributing to the strong operating cash flow[74] User Growth and Engagement - Monthly active users (MAUs) increased to 120 million, up 10% compared to the previous year[1] - Average MPUs grew by 39.1% year-to-year from 29.7 million in 2022 to 41.3 million in 2023[9] - APUs increased by 25.2% year-to-year from 187.5 million in 2022 to 234.7 million in 2023[9] - Average Monthly Paying Users (MPUs) increased by 39.1% year-over-year from 29.7 million in 2022 to 41.3 million in 2023[19] - Annual Paying Users (APUs) increased by 25.2% from 187.5 million in 2022 to 234.7 million in 2023, reaching a historic high[19] - Approximately 80% of the company's average Monthly Active Users (MAUs) were contributed by the Weixin mini-program in 2023[23] - Registered users residing in non-first-tier cities accounted for approximately 86.9% of total registered users as of December 31, 2023[26] - Approximately 72.7% of new paying users on the Weixin platform were from non-first-tier cities in 2023[26] - 86.9% of registered users are from non-tier 1 cities in China as of December 31, 2023[28] - 72.7% of new paying users on the WeChat platform in 2023 were from non-tier 1 cities in China[28] Market Expansion and Acquisitions - The company plans to expand into three new international markets in the next fiscal year[1] - The company completed two strategic acquisitions, totaling $500 million, to enhance its market position[1] - The company completed the acquisition of Beijing Tongcheng Tourism Investment Group Co., Ltd. in Q4 2023 to strengthen its market position[31] - The company signed a strategic agreement with Chengdu Shuangliu Airport in Q4 2023 to develop it as a regional transit hub[33] - The company acquired 100% equity interest in Beijing Tongcheng Tourism Investment Group Ltd. on November 30, 2023, to strengthen its market position in the travel industry[86][91] - The company acquired approximately 57.1656% equity interest in Hainan Yanuoda Yuanrong Tourism Co., Ltd. on November 30, 2023, to expand its travel industry supply chain[87][91] - The company plans to explore potential acquisitions, investments, joint ventures, and partnerships aligned with its overall business strategies[93] - The company will actively seek mergers and acquisitions to expand its market size[163] Technology and Innovation - R&D investment increased by 25% to $300 million, focusing on AI and machine learning technologies[1] - The company launched a new mobile app feature, resulting in a 30% increase in user engagement[1] - The company prioritizes the development of information technology, including big data and artificial intelligence capabilities[113] - The company plans to transition from an OTA to an ITA by leveraging advanced technological capabilities[37] - The company will continue to penetrate lower-tier city markets, where core business has shown rapid growth[37] - The company uses data analytics to help TSPs develop innovative services and optimize product pricing, aiming to build stronger ties with existing TSPs and attract potential ones[147][150] - The company has developed proprietary technologies, including a customer management system and an e-booking system, to interact with TSPs and assist them in managing, pricing, and marketing their supply[149][150] - The company focuses on attracting, training, and retaining talent in technology, research, and development, offering performance-based compensation, on-the-job training, and promotion opportunities to strengthen technology innovation[156] Operational Efficiency and Costs - Cost of revenue rose by 74.8% to RMB3,158.0 million in 2023, mainly due to increased order processing costs and pre-purchased travel-related products[50] - Order processing costs increased by 84.1% to RMB1,332.1 million in 2023, reflecting higher GMV[50] - Cost of pre-purchased travel-related products grew by 198.6% to RMB462.4 million in 2023, driven by tourism services[50] - Procurement costs increased by 109.9% to RMB431.3 million in 2023, due to expanded value-added user services[50] - Employee benefit expenses rose by 46.5% to RMB479.7 million in 2023, as the number of user service and TSP service employees increased[50] - Excluding share-based compensation, cost of revenue as a percentage of total revenue decreased from 27.2% in 2022 to 26.5% in 2023[50] - Sales cost increased by 74.8% from RMB 1,806.6 million in 2022 to RMB 3,158.0 million in 2023, primarily due to higher transaction volume and increased order processing costs, which rose from RMB 723.4 million to RMB 1,332.1 million[51] - Service development expenses increased by 28.7% from RMB 1,414.1 million in 2022 to RMB 1,820.6 million in 2023, driven by an increase in IT employees and related benefits[52] - Selling and marketing expenses increased by 59.7% from RMB 2,801.2 million in 2022 to RMB 4,472.8 million in 2023, mainly due to higher advertising, promotion, and agency commission expenses[52] - Administrative expenses remained flat at RMB 711.2 million in 2023 compared to RMB 701.1 million in 2022, with a decrease in the percentage of revenue from 6.6% to 4.1%[52] - Net provision for impairment loss on financial assets decreased to RMB 17.5 million in 2023 from RMB 28.4 million in 2022, primarily due to lower expected credit losses on trade and other receivables[53][56] - Fair value loss on investments measured at fair value through profit or loss was RMB 32.5 million in 2023, mainly due to losses recognized in one investment in Q4 2023[54][57] - Other income decreased from RMB 153.8 million in 2022 to RMB 122.8 million in 2023, reflecting a reduction in government subsidies[55][58] - Net other gains increased to RMB 62.9 million in 2023 from net other losses of RMB 113.5 million in 2022, driven by reduced foreign exchange losses and higher gains on derivative financial instruments[59] - Income tax expense increased to RMB 288.1 million in 2023 from RMB 46.5 million in 2022, primarily due to higher current income tax charges[59] - Share-based compensation expense for 2023 was RMB 348.1 million, down from RMB 441.1 million in 2022[66] - Amortization of intangible assets in 2023 was RMB 678.6 million, slightly higher than RMB 639.8 million in 2022[66] - Depreciation of property, plant, and equipment and right-of-use assets in 2023 was RMB 232.1 million, up from RMB 200.4 million in 2022[66] - Foreign exchange loss in 2023 was RMB 66.8 million, significantly lower than RMB 215.4 million in 2022[66] - Net gains on investees in 2023 were RMB 36.8 million, compared to RMB 43.0 million in 2022[66] - Total share-based compensation for 2023 was RMB 376.4 million, a decrease from RMB 409.3 million in 2022[72] - Net cash generated from operating activities in 2023 was RMB 4,003.4 million, a significant increase from RMB 302.3 million in 2022[73] - Net cash used in investing activities in 2023 was RMB 1,762.2 million, primarily due to equity investments of RMB 1,721.7 million and purchases of property, plant, and equipment of RMB 952.1 million[76] - Net cash used in financing activities in 2023 was RMB 592.2 million, mainly due to repayment of borrowings and settlement of long-term payables[76] - The company's gearing ratio as of December 31, 2023, was approximately 17.0%[76] - Total capital expenditure for 2023 was RMB 3,224.8 million, including RMB 952.1 million for property, plant, and equipment, and RMB 1,721.7 million for long-term investments[77] - Trade payables increased by RMB 1,177.5 million in 2023, reflecting changes in working capital[74] - The company repaid a loan of RMB 196.9 million in February 2023, which was secured by property[76] - Long-term investments as of December 31, 2023, amounted to RMB 3,153.0 million, a decrease from RMB 3,980.7 million in 2022, representing 9.9% and 15.9% of the Group's total assets, respectively[81][82] - Investments accounted for using the equity method increased to RMB 1,429.8 million in 2023, up from RMB 1,379.3 million in 2022, due to more investments in private companies with significant influence[81][82] - Investments measured at fair value through profit or loss rose to RMB 1,039.3 million in 2023, compared to RMB 758.3 million in 2022, driven by investments in private companies and funds without significant influence[81][82] - Investments measured at amortized cost decreased to RMB 683.9 million in 2023 from RMB 1,843.2 million in 2022, mainly due to maturities within one year[81][82] - Short-term investments totaled RMB 3,948.5 million in 2023, up from RMB 3,163.2 million in 2022, representing 12.5% and 12.6% of the Group's total assets, respectively[83][84] - Short-term investments measured at amortized cost surged to RMB 2,316.8 million in 2023 from RMB 494.0 million in 2022, primarily consisting of time deposits with fixed interest rates[83][84] - Short-term investments measured at fair value through profit or loss decreased to RMB 1,631.7 million in 2023 from RMB 2,669.2 million in 2022, mainly comprising wealth management products with expected returns of 1.30% to 5.20%[83][84] Sustainability and ESG - The company achieved an AA MSCI ESG rating for the second consecutive year in 2023 and was included in The Sustainability Yearbook (China) 2023 by S&P Global[34] - The company's MSCI ESG rating was maintained at AA for the second consecutive year in 2023, reflecting strong sustainability efforts[36] - The Group made charitable donations totaling RMB 635,000 during the year ended December 31, 2023[131] - The Group complied with relevant laws and regulations, including the PRC Cybersecurity Law and Personal Information Protection Law[134] Shareholder and Dividend Information - The board approved a share buyback program of up to $200 million[1] - The Board proposed a final dividend of HKD 0.15 per share for the year ended December 31, 2023, with an estimated total payout of approximately HKD 339,388,938[113] - The total number of issued shares as of March 15, 2024, is 2,262,592,922[113] - The final dividend is expected to be paid on or about July 19, 2024, to shareholders listed on the register of members as of July 5, 2024[113] - The company has distributable reserves totaling RMB 20,543 million as of December 31, 2023[114] - The net proceeds from the Global Offering were fully utilized by December 31, 2023, with RMB 355.1 million carried forward from 2022 and used in 2023[118] - 30% of the net proceeds (RMB 395.8 million) were used to enhance products, services, and the TSP and user bases[120] - 40% of the net proceeds (RMB 158.3 million) were allocated to expanding the user base through strengthened user acquisition channels[120] - 30% of the net proceeds (RMB 118.7 million) were used to expand product and service offerings by building relationships with existing and emerging TSPs and developing innovative travel products[120] - 20% of net proceeds (RMB 79.2 million) allocated to increase brand awareness through advertising and promotional activities[122] - 10% of net proceeds (RMB 39.6 million) used to enhance user stickiness by improving membership loyalty programs[122] - 30% of net proceeds (RMB 395.8 million) allocated for potential acquisitions, investments, joint ventures, and partnerships[122] - 30% of net proceeds (RMB 395.8 million) used to enhance overall technology capabilities, including big data and AI (RMB 158.3 million), IT infrastructure (RMB 158.3 million), and competitive compensation for IT talent (RMB 79.2 million)[122] - 10% of net proceeds (RMB 131.9 million) allocated for working capital and general corporate purposes[122] - Total net proceeds utilized as of December 31, 2023, amounted to RMB 355.1 million[122] Business Strategy and Future Outlook - The company expects revenue growth of 10-12% for the next fiscal year[1] - The company achieved a second growth trajectory through substantial progress in hotel management and packaged tour businesses[37] - The company anticipates a robust expansion of the domestic travel market and significant progress in the outbound travel sector in 2024[37] - The company plans to transition from an OTA to an ITA by leveraging advanced technological capabilities[37] - The company will continue to penetrate lower-tier city markets, where core business has shown rapid growth[37] - The company plans to diversify its travel service provider (TSP) sources by contracting directly with airlines, hotel operators, and railway companies, as well as collaborating with regional travel agents and third-party online travel agencies[163] - The company will actively seek mergers and acquisitions to expand its market size[163] - The company depends on maintaining existing partnerships, including with TSP and Tencent Group, and any adverse changes could negatively impact its business[163] - The company will deepen cooperation with business partners by leveraging technology to offer innovative and customized products and services[163] - The company plans to diversify service providers for payment, settlement, and other technical services, and expand its user base through various traffic acquisition channels[163] - The online travel industry is highly competitive, with the company facing competition from other online travel agencies, traditional travel agencies, and travel service suppliers[163] - The company will continue to invest substantially in sales and marketing efforts, including broadening user acquisition channels and improving market competition analysis mechanisms[164][165] - The company aims to increase competitiveness by expanding product and service offerings, growing its user base, enhancing user engagement, and pursuing strategic alliances, acquisitions, and investments[164][165] - The Group's user base and user engagement are critical to its success, with potential risks if users no longer find its products and services attractive[167] - The Group plans to expand its user base through diverse traffic acquisition channels, including increasing awareness of Tencent-based platforms

Core Insights - The article highlights the resurgence of interest in zoos, particularly among younger demographics, driven by nostalgia, social media influence, and the appeal of "celebrity animals" [1][4][16] Group 1: Trends in Zoo Attendance - During the recent Qingming holiday, zoo attendance surged, with ticket orders increasing by 649% year-on-year, indicating a strong public interest in zoo tourism [4] - Notable attendance figures include Nanjing Hongshan Zoo reaching a maximum capacity of 80,000 visitors on the first day of the holiday, comparable to daily visitor numbers at Shanghai Disneyland [4][6] - The demographic shift shows that over 60% of ticket buyers at Nanjing Hongshan Zoo are under 30 years old, reflecting a trend towards younger visitors [6][16] Group 2: Factors Driving Zoo Popularity - The "celebrity effect" of unique and popular animals, such as pandas and other rare species, has significantly boosted zoo visibility and visitor numbers [7][9] - Enhanced visitor experiences, including interactive exhibits and quality services, have become crucial for attracting and retaining visitors [9][11] - Innovative marketing strategies utilizing social media and collaborations with influencers have effectively engaged younger audiences [11][18] Group 3: Economic and Operational Strategies - Zoos are diversifying their revenue streams through ticket sales, sponsorships, merchandise, and food services, with ticket sales being a primary income source [13][14] - The integration of educational and conservation programs has become a key aspect of zoo operations, enhancing their cultural and social value [13][20] - The trend towards personalized visitor experiences, including interactive and immersive activities, is reshaping the traditional zoo model into a more dynamic entertainment venue [18][20] Group 4: Future Challenges and Considerations - Balancing animal welfare with visitor engagement remains a critical challenge for zoos, necessitating careful planning of visitor interactions [20] - The need for sustainable business models that uphold the educational and conservation missions of zoos while ensuring economic viability is increasingly important [20][21] - The future of zoos is expected to be characterized by diversity, personalization, and digital engagement, aligning with evolving consumer preferences [21]

Core Insights - The holiday economy is showing robust vitality in the domestic cultural and tourism market, with expectations for stable growth during the upcoming "May Day" holiday [1] - The "May Day" tourism heat is increasing compared to last year, driven by favorable policies and improved travel experiences [1][2] Group 1: Tourism Market Trends - The "May Day" holiday tourism bookings exhibit three main characteristics: 1. Development of the lower-tier tourism market, with hotel bookings in county areas increasing by 68% and scenic ticket orders rising by 151% year-on-year [1] 2. The rise of "internet celebrity" cities, attracting younger tourists who prioritize cost-effectiveness and personalized experiences [2] 3. Strong demand for staggered travel before the holiday, with significant increases in train and flight bookings for popular routes [2] Group 2: Market Support and Initiatives - The tourism market's growth is supported by various market participants, including local governments and businesses, which are implementing diverse strategies to enhance tourism experiences [3] - Examples include tailored travel routes and promotional campaigns in cities like Tianshui, as well as initiatives across multiple regions to improve tourism services and market regulation [3]

M N 10 Apr 2024 CMB International Global Markets | Equity Research | Company Update Tongcheng Travel (780 HK) Continued outperformance during Qingming Target Price HK$26.10 The three-day Qingming Festival holiday embraced booming demand, with (Previous TP HK$26.10) domestic tourist trips +11.5% and tourism revenue +12.7% (both vs. the Up/Downside 23.7% 2019 level), according to the Ministry of Culture and Tourism. Tongcheng Current Price HK$21.10 Travel (TC) kept its strong momentum during the Qingming Fest ...

Stock Data and Market Performance - The stock closed at HKD 21.10 on April 9, with a 52-week price range of HKD 13.12-21.40 [1] - The company has a total market capitalization of HKD 47.9 billion, with 2.27 billion shares outstanding [1] - Over the past 3 months, the stock has shown an absolute return of 40.11% and a relative return of 36.17% compared to the CSI 300 index [2] Company Overview and Competitive Advantages - The company is a leading OTA platform in China, formed through the merger of Tongcheng Network and eLong in 2018 [3] - It has strong partnerships with Tencent and Ctrip, with 80% of MAU coming from WeChat mini-programs [4] - The company has a dominant position in lower-tier cities, with 86.9% of registered users from non-first-tier cities as of 2023 [3] Financial Performance and Growth - Revenue in 2023 reached RMB 11.896 billion, an 80.7% YoY increase, surpassing pre-pandemic 2019 levels by 60.9% [2] - Net profit turned positive at RMB 1.554 billion in 2023, compared to a loss of RMB 146 million in 2022 [5] - The company expects revenue to grow to RMB 23.931 billion by 2026, with a CAGR of 19.1% from 2023-2026 [5] Business Segments and Expansion - The platform offers over 420,000 flight routes, 2.5 million hotels, 430,000 bus routes, and 10,000 attraction tickets [4] - Domestic hotel room nights sold in Q4 2023 exceeded 70% of 2019 levels, while international room nights fully recovered [4] - The company completed acquisitions of Tongcheng Tourism Group and Yalong Bay Tropical Paradise in 2023 to expand its tourism business [4] Valuation and Investment Rating - The stock is trading at 19.25x 2023 P/E and 1.69x P/B, with an EV/EBITDA of 14.88x [9] - Analysts forecast 2024-2026 adjusted net profits of RMB 2.73 billion, RMB 3.065 billion, and RMB 3.655 billion respectively [6] - The target price range is HKD 23.38-29.88, representing 18-23x 2024 P/E, with an "Outperform" rating [6] Industry Trends and Growth Drivers - The company benefits from China's tourism market recovery, with strong demand for domestic and outbound travel [6] - It has launched a "Global Destination Plan" to capture growth in cross-border travel [6] - The company's focus on lower-tier cities and WeChat ecosystem integration provides a competitive edge [3][4]

Investment Rating - The report maintains a "Buy" rating for the company, with an increased target price of HKD 24 [1][2]. Core Insights - The report highlights that during the Qingming Festival, the average spending per tourist exceeded 2019 levels, with a total of 539.5 billion RMB spent, marking a 12.7% increase compared to the same period in 2019 [1]. - For the upcoming May Day holiday, there is a strong booking trend, with domestic flight prices rising above those during the Qingming Festival, indicating continued confidence in the tourism sector [1]. - The company is expected to benefit from the ongoing recovery in the tourism industry, particularly through the appeal of trendy cities attracting younger consumers [1]. Financial Summary - The company is projected to generate revenue of 37.2 billion RMB in Q1 2024, representing a 44% year-on-year growth, with accommodation revenue expected to reach 9.4 billion RMB [1][2]. - Transportation revenue is anticipated to be 17.0 billion RMB, reflecting a 23% year-on-year increase [2]. - The adjusted net profit for FY24E is forecasted at 2.546 billion RMB, with an adjusted target PE of 20.0x for FY24E [2].

Investment Rating - The report maintains a "Recommend" rating for the company, citing its strong operational performance, strategic acquisitions, and growth potential in the travel industry [1][2] Core Views - The company achieved significant growth in 2023, with revenue reaching 11.896 billion RMB, up 80.7% YoY, and adjusted net profit of 2.199 billion RMB, up 240.3% YoY [1] - The company's gross margin improved to 73.5%, up 0.7 percentage points YoY, while the adjusted net margin increased to 18.5%, up 8.8 percentage points YoY [1] - The company's transaction volume surged to 241.5 billion RMB, up 96.8% YoY, driven by strong performance in accommodation booking and transportation ticketing services [1] - The company's strategic focus on lower-tier cities and WeChat traffic has been successful, with 86.9% of registered users coming from non-first-tier cities [1] Financial Performance - In Q4 2023, the company's revenue reached 3.145 billion RMB, up 109.6% YoY, with adjusted net profit of 483 million RMB, up 1188.3% YoY [1] - The company's annual paying users increased to 235 million, up 25.2% YoY, while average monthly paying users reached 41 million, up 39.1% YoY [1] - The company's EPS is projected to grow from 0.69 RMB in 2023 to 1.49 RMB in 2026, with P/E ratios expected to decline from 19x in 2024 to 12x in 2026 [2][5] Strategic Initiatives - The company deepened its strategic cooperation with Tencent, with 80% of average monthly active users coming from WeChat mini-programs [1] - The company expanded its offline customer acquisition channels, which contributed to the growth of monthly paying users in Q4 2023 [1] - The company enhanced its membership system, particularly the Black Whale membership program, which saw a significant increase in cumulative members in Q4 2023 [1] - The company completed the acquisition of Beijing Tongcheng Travel Industry Group in Q4 2023, strengthening its position in the travel industry supply chain [1] Future Outlook - The company is expected to achieve net profits of 2.062 billion RMB, 2.723 billion RMB, and 3.369 billion RMB in 2024, 2025, and 2026, respectively [1] - The company's revenue is projected to grow from 17.028 billion RMB in 2024 to 23.728 billion RMB in 2026, with a CAGR of 16.6% [2][5] - The company's ROE is expected to improve from 8.78% in 2023 to 13.03% in 2026, reflecting stronger profitability and operational efficiency [7] Market Position - The company's focus on lower-tier cities and rural tourism projects has been a key driver of user growth, with 72.7% of new paying users on WeChat coming from non-first-tier cities [1] - The company's integration of Tongcheng Travel and the launch of offline store franchising plans have expanded its customer base and market reach [1] - The company's strategic acquisitions and partnerships are expected to further enhance its competitive advantage and market influence in the travel industry [1]

Investment Rating - The report maintains a "Buy" rating for the company [2][3] Core Views - The company is expected to benefit from the recovery of domestic and outbound tourism, with a positive cycle of improving profit margins [2] - The adjusted net profit estimates for 2024 and 2025 have been raised to 2.715 billion and 3.291 billion RMB respectively, with a new estimate for 2026 at 4.002 billion RMB [2] - The target market capitalization is set at 53.3 billion RMB, corresponding to a target price of 25.90 HKD, based on a 20x PE valuation for 2024 [2] Financial Summary - Revenue for 2023Q4 reached 3.145 billion RMB, representing a year-on-year increase of 109.63% [2] - Adjusted EBITDA for the same period was 716 million RMB, up 193% year-on-year [2] - The adjusted net profit for 2023Q4 was 483 million RMB, compared to 37 million RMB in 2022Q4, with an adjusted net profit margin of 15.3% [2] - The company experienced a significant reduction in sales expense ratio from 37.9% in 2022Q4 to 35.8% in 2023Q4, and a decrease in management expense ratio from 6% in 2023Q3 to 3.6% in 2023Q4 [2] Business Outlook - The company has integrated travel agency operations, which are expected to contribute to the tourism business segment, potentially accounting for 15% of total revenue [2] - The outbound tourism business is projected to grow faster than domestic tourism in 2024, with the company actively expanding its international supply chain [2] - The company is currently in a phase of improving market conditions, with increased online travel engagement in lower-tier cities and enhanced profit margins [2]

[Table_Title] 【 广 发 商 社 & 海 外 】 同 程 旅 行 （00780.HK） GMV 和付费用户数创新高，首次派息回报股东 [Table_Summary] 核心观点：（本文除特殊说明外均采用人民币为货币单位） ⚫ 同程旅行公布 4Q23 财报。公司 23Q4 GMV 同比增长 110.6%至 535 亿元，收入同比增长 109.6%至 31.4 亿元。公司 23Q4 non-IFRS 净利 润同比增长 1188.3%至 4.8 亿元，non-IFRS 净利率同比增长 2.5pct 至 15.3%。公司 23Q4 的 MPU 同比增长 54.3%至 3750 万人。 ⚫ 公司 2023 年 non-IFRS 净利润同比增长 240.3%至 22.0 亿元，non- IFRS 净利率同比增长 9.8pct 至 18.5%，基本恢复至 2019 年同期水 平。公司首次派息，2023 年每股派 0.15 港元，总共派息 3.4 亿港元。 ⚫ 分业务来看：（1）23Q4 公司的交通票务收入同比增长 94.9%至 14.7 亿元。其中，机票票量较 19Q4 增长 16%，远超行业整体表现。（2） ...