Investment Rating - The report maintains a "Recommend" rating for the company [4][9] Core Views - The company's Q3 2024 revenue reached RMB 4.99 billion, a YoY increase of 51.3%, exceeding expectations [2] - Core OTA business revenue was RMB 4.01 billion, up 21.6% YoY, in line with expectations [2] - Net profit attributable to shareholders was RMB 790 million, a YoY increase of 55.5% [2] - Non-GAAP net profit was RMB 910 million, up 46.6% YoY [2] - Hotel take rate improvement drove revenue growth in the accommodation booking segment, with international room nights increasing by 130% YoY [2] - Transportation ticketing revenue reached a historical high of RMB 2.03 billion, driven by a 110% YoY increase in international air ticket volume [2] - Other revenue grew 23.7% YoY to RMB 610 million, supported by strong growth in hotel management and online vacation businesses [2] - The company's average monthly paying users reached 46.4 million, a 5% YoY increase, with ARPU rising to around RMB 70, up RMB 6 QoQ [3] - Non-GAAP net margin was 18%, with core OTA platform margin reaching 31%, a post-pandemic high [3] Financial Forecasts - Revenue is expected to grow from RMB 17.212 billion in 2024E to RMB 24.166 billion in 2026E, with a CAGR of 18.5% [6] - Non-GAAP net profit is projected to increase from RMB 2.732 billion in 2024E to RMB 4.468 billion in 2026E [6] - Adjusted diluted EPS is forecasted to grow from RMB 1.18 in 2024E to RMB 1.92 in 2026E [6] - The company's P/E ratio is expected to decline from 14.01X in 2024E to 8.57X in 2026E [6] Business Performance - Accommodation booking revenue grew 22.2% YoY to RMB 1.38 billion, outperforming ADR and overall hotel industry growth [2] - Vacation segment revenue reached RMB 980 million [2] - The company has 230 million annual paying users and 1.88 billion annual cumulative service users, up 3.4% and 19.9% YoY respectively [3] - Gross margin was 63% in Q3 2024, down 11.2 ppts YoY but only 1.2 ppts QoQ [3] - Sales and marketing expenses as a percentage of revenue decreased by 9.1 ppts YoY to 29% [3]

Investment Rating - The report maintains a "Buy" rating for Tongcheng Travel (0780.HK) [5] Core Insights - Tongcheng Travel reported a significant revenue growth of 51.3% year-on-year in Q3 2024, reaching 4.992 billion CNY, driven by strong performance in its core OTA business and vacation services [3] - The adjusted EBITDA for Q3 2024 was 1.319 billion CNY, reflecting a 51.6% increase year-on-year, while the adjusted net profit was 910 million CNY, up 46.6% year-on-year [3] - The company continues to deepen its market penetration, particularly in lower-tier cities, with over 87% of registered users from non-first-tier cities [3] Financial Performance - Q3 2024 revenue breakdown: accommodation booking revenue was 1.378 billion CNY (+22.2% YoY), transportation ticketing revenue was 2.027 billion CNY (+20.64% YoY), and other core OTA revenues were 609 million CNY (+23.7% YoY) [3] - The net profit margin for Q3 2024 was 18.2%, slightly down by 0.6 percentage points compared to the same period last year [3] - The company’s sales costs increased significantly by 117.55% year-on-year to 1.827 billion CNY, primarily due to rising costs in vacation service products and increased employee benefits [3] User Growth and Market Strategy - The average monthly paying users reached 46 million, a 5% increase year-on-year, while annual paying users totaled 232 million, up 3.4% year-on-year [3] - The report highlights the collaboration with Tencent and Alipay as a key factor in user growth, particularly in lower-tier markets [3] - The company aims to enhance its competitive advantage through mergers and acquisitions, expanding its presence in accommodation, vacation, and outbound travel sectors [3] Future Projections - The projected net profits for Tongcheng Travel are expected to be 1.942 billion CNY in 2024, 2.485 billion CNY in 2025, and 2.958 billion CNY in 2026, with corresponding P/E ratios of 20x, 16x, and 13x respectively [3][4]

Investment Rating - Maintain "Overweight" rating [1] Core Views - Q3 revenue slightly exceeded the upper guidance range, with profits surpassing expectations: Q3 revenue reached 4,991 million yuan, up 51.6% YoY, slightly exceeding the guidance range of 45-50% [2] - User subsidies narrowed, leading to significant improvement in sales expense ratio: Q3 gross margin was 63.4%, down 14.8 pct YoY, while sales expense ratio improved to 29.4%, down 9.1 pct YoY [2] - Transportation and accommodation businesses showed steady growth: Core OTA segment revenue increased by 21.6% YoY, with transportation ticketing and accommodation booking revenues reaching 2,027 million yuan and 1,378 million yuan, respectively, both hitting historical highs [3] - Monthly paying users reached a new historical high, with continued penetration in lower-tier markets: As of Q3 2024, annual paying users reached 232 million, up 3.4% YoY, with over 87% of registered users residing in non-tier-1 cities [3] Financial Performance and Forecasts - Revenue and profit forecasts adjusted upward: Expected 2024-2026 net profit attributable to parent company adjusted to 2,093.75 million yuan, 2,648.42 million yuan, and 3,265.09 million yuan, respectively [4] - EPS and valuation metrics: 2024E EPS is 0.90 yuan per share, with a P/E ratio of 18.81x [1] - Key financial ratios: ROE expected to improve from 8.78% in 2023A to 12.70% in 2026E, with net profit margin projected to increase from 13.06% to 13.56% over the same period [14] Business Segments - Transportation ticketing and accommodation booking: Q3 revenue for transportation ticketing and accommodation booking grew by 20.6% and 22.2% YoY, respectively [3] - Vacation segment: Q3 vacation segment revenue reached 979 million yuan, exceeding the company's guidance of 900-950 million yuan [3] Market and User Metrics - User engagement: Q3 average monthly paying users reached 46 million, up 5.0% YoY, with transaction volume of 72.8 billion yuan, up 2.4% YoY [3] - Lower-tier market penetration: Approximately 70% of new paying users on the WeChat platform in Q3 came from non-tier-1 cities [3]

Investment Rating - The report maintains a **Buy** rating for Tongcheng Travel with a target price of **HKD 25.8**, up from the previous target of HKD 23.1 [5][8] Core Views - **Revenue Growth**: Tongcheng Travel reported 3Q24 revenue of RMB 5 billion, a 51% YoY increase, slightly exceeding expectations of RMB 4.9 billion [1][2] - **Profitability**: Adjusted net profit for 3Q24 reached RMB 910 million, a 47% YoY increase, surpassing expectations by 10.2% [1][3] - **Outbound Travel**: Outbound hotel bookings and air ticket sales saw triple-digit growth, with international room nights up 130% YoY and international ticket volume up 110% YoY [2] - **User Value Focus**: The company shifted its strategy from user growth to maximizing user value, resulting in a 53% YoY increase in ARPU to RMB 70 [4] Revenue Breakdown - **Core OTA Business**: Revenue from core OTA business reached RMB 4 billion, a 22% YoY increase, driven by improved commission rates and strong outbound travel demand [2] - **Accommodation Business**: Revenue grew 22% YoY, exceeding expectations by 3%, with international room nights up 130% YoY [2] - **Transportation Business**: Revenue increased 22% YoY, surpassing expectations by 1.3%, supported by a 110% YoY growth in international ticket volume [2] Profitability and Cost Control - **Operating Profit**: Operating profit for 3Q24 was RMB 970 million, a 63% YoY increase, exceeding expectations by 26% [3] - **Cost Efficiency**: The company achieved significant cost control, with total expense ratio 4 percentage points lower than expected [3] - **Core OTA Profit**: Core OTA platform operating profit reached RMB 1.2 billion, 8.2% above expectations [3] User Metrics - **Monthly Active Paying Users**: Average monthly paying users reached 46.4 million, a 5% YoY increase [4] - **Annual Paying Users**: Annual paying users grew to 230 million, a 3.4% YoY increase [4] - **ARPU Growth**: ARPU increased to RMB 70, up 53% YoY, driven by improved marketing efficiency and cross-selling strategies [4] Financial Forecasts - **Revenue Forecast**: Expected revenue for 2024-2026 is RMB 17.3 billion, RMB 21.9 billion, and RMB 26.5 billion, respectively [5][12] - **Adjusted Net Profit Forecast**: Adjusted net profit for 2024-2026 is projected at RMB 2.77 billion, RMB 3.67 billion, and RMB 4.51 billion, respectively [5][12] - **Valuation**: The target price of HKD 25.8 is based on a 15x PE multiple for 2025, reflecting a discount to the peer average of 19.5x [5][14] Peer Comparison - **Valuation Multiples**: Tongcheng Travel's 2025 PE multiple of 15x is lower than peers such as Booking (23.9x) and Airbnb (29.8x) [15]

Investment Rating - The report maintains a "Buy" rating for the company with a target price adjusted to HKD 24.00, indicating a potential upside of 35.6% from the current price of HKD 17.70 [1][4][12]. Core Insights - The core OTA business is expected to grow faster than the industry average, with revenue projections of RMB 17.2 billion for 2024 and RMB 19.8 billion for 2025, reflecting growth rates of 19% and 16% respectively. The operating profit margin is anticipated to exceed 26%, leading to net profits of RMB 2.7 billion and RMB 3.4 billion for the respective years [1][2]. - The company reported a 51% year-on-year revenue increase in Q3 2024, reaching RMB 5 billion, which surpassed market expectations. The core OTA business revenue grew by 22%, driven by significant increases in both transportation and accommodation segments [2][3]. - The forecast for Q4 2024 anticipates a revenue increase of 29% to RMB 40.5 billion, with the core OTA segment expected to grow by 10% [2][9]. Financial Projections - Revenue forecasts for 2024 and 2025 have been slightly adjusted, with total revenue expected to be RMB 17.2 billion and RMB 19.8 billion respectively, reflecting growth rates of 44.2% and 15.7% [3]. - The adjusted operating profit margin is projected to improve to 16.3% for 2024 and 17.5% for 2025, with net profit margins expected to be 16.0% and 17.0% respectively [3][9]. - The company’s gross profit margin is forecasted to be 64.4% in 2024, slightly down from previous estimates, but still indicating strong profitability [3]. Market Performance - The stock has shown a year-to-date increase of 22.58%, with a market capitalization of approximately HKD 40.4 billion [6]. - The stock's 52-week high and low are HKD 22.30 and HKD 12.70 respectively, indicating significant volatility and potential for growth [6]. Summary of Earnings - The company achieved a net profit of RMB 9.1 billion in Q3 2024, a 47% increase year-on-year, exceeding market expectations by 11% [2][3]. - The operational efficiency is improving, with marketing expenses as a percentage of revenue decreasing to 29%, which is better than the anticipated 33% [2]. Conclusion - The report indicates a positive outlook for the company, driven by strong growth in the core OTA business, improved operational efficiency, and favorable market conditions, supporting the "Buy" rating and the revised target price [1][4][12].

20 Nov 2024 CMB International Global Markets | Equity Research | Company Update Tongcheng Travel (780 HK) Travel demand remains resilient Tongcheng Travel (TC) reported 3Q24 results: total revenue was RMB5.0bn, up 51% YoY (2Q24: +48% YoY), 3% better than Bloomberg consensus estimates; adjusted net income was RMB910mn, up 47% YoY, 11% better than consensus. OPM of core OTA businesses improved to 31.1% in 3Q24 (3Q23: 25.2%), driven by optimization of marketing strategies. Booking volume growth of TC's transpo ...

Financial Performance - Revenue increased by 51.3% year-on-year to RMB 4,991.5 million for the three months ended September 30, 2024, compared to RMB 3,299.3 million in the same period of 2023[2] - Adjusted EBITDA rose by 51.6% year-on-year to RMB 1,318.8 million, maintaining an adjusted EBITDA margin of 26.4%[2] - Adjusted net profit increased by 46.6% year-on-year to RMB 910.0 million, with an adjusted net profit margin of 18.2%, down from 18.8% in the previous year[2] - Total revenue increased by 51.3% from RMB 3,299.3 million in Q3 2023 to RMB 4,991.5 million in Q3 2024[27] - Revenue from the core online travel platform rose by 21.6% to RMB 4,012.8 million, driven by accommodation booking services and transportation ticketing services[29] - Operating profit for Q3 2024 was RMB 977.1 million, compared to RMB 598.9 million in Q3 2023[25] - Adjusted net profit for Q3 2024 was RMB 910.0 million, up from RMB 620.6 million in Q3 2023[25] - Net profit for the period was RMB 803,234 thousand, a 55.7% increase from RMB 515,488 thousand in the prior year[63] - Total comprehensive income for the period was RMB 788,482 thousand, compared to RMB 508,254 thousand in the same quarter of 2023, reflecting a 55.1% growth[66] User Growth and Engagement - Average monthly paying users grew by 5.0% year-on-year to 46.4 million, while annual paying users increased by 3.4% to 232.4 million[2] - Cumulative service users for the twelve months ended September 30, 2024, reached 1,882.5 million, a 19.9% increase from 1,570.6 million in the previous year[2] - The user base is predominantly from non-first-tier cities in China, accounting for over 87% of registered users[12] - Approximately 71% of new paying users on the WeChat platform during the quarter came from non-first-tier cities[12] - The company has expanded its Black Whale membership program, significantly increasing the cumulative number of members in Q3 2024, enhancing user engagement and loyalty[15] Revenue Breakdown - Revenue from transportation ticketing services increased by 20.6% year-over-year to RMB 2,026.8 million, driven by increased ticket volume and enhanced value-added products and services[16] - The accommodation business achieved a revenue growth of 22.2% year-over-year, reaching RMB 1,377.5 million, with international night stays increasing by over 130%[17] - The company's other income from the core online travel platform reached RMB 608.5 million, reflecting a year-over-year growth of 23.7%[17] - The vacation business recorded revenue of RMB 978.7 million in Q3 2024, indicating strong growth amid the industry's recovery[19] - Accommodation booking service revenue increased by 22.2% to RMB 1,377.5 million, attributed to a wider range of accommodation products and enhanced cross-selling strategies[29] - Transportation ticketing service revenue grew by 20.6% to RMB 2,026.8 million, due to increased demand for ticketing services and value-added products[29] Operational Efficiency and Costs - The company continues to enhance operational efficiency to achieve better profit margins[11] - Total cost of sales increased from RMB 839.7 million in Q3 2023 to RMB 1,826.8 million in Q3 2024, with the cost-to-revenue ratio rising from 25.4% to 36.5%[34] - Selling and marketing expenses increased by 15.4% to RMB 1,467.6 million, with the expense-to-revenue ratio decreasing from 38.3% to 29.2%[37] - Administrative expenses rose to RMB 327.7 million from RMB 196.5 million, with the expense-to-revenue ratio increasing from 4.6% to 5.1%[38] Market Outlook and Strategy - The company is optimistic about the growth potential of the Chinese tourism market, driven by improved infrastructure and supportive government policies[21] - The company plans to continue expanding its outbound business and strengthen its market position in the travel industry while seeking investment opportunities aligned with its strategic goals[22] - The company aims to enhance user experience through AI-driven customer service systems and algorithm-driven travel solutions, focusing on providing more convenient travel options[19] Financial Position - Non-current assets increased to RMB 19,229,430 thousand as of September 30, 2024, from RMB 16,816,963 thousand at the end of 2023, marking a 8.3% rise[70] - Current assets rose to RMB 17,467,841 thousand, up from RMB 14,899,646 thousand, indicating an increase of 17.0%[71] - Total liabilities increased to RMB 16,227,845 thousand from RMB 13,170,320 thousand, a growth of 23.4%[74] - Cash and cash equivalents at the end of the period were RMB 5,737,276 thousand, compared to RMB 5,281,623 thousand in the previous year[76] - The company reported a net cash outflow from operating activities of RMB 647,655 thousand for the quarter, compared to a net inflow of RMB 706,376 thousand in the same period last year[76] Governance and Management - The company expressed gratitude to shareholders, management team, employees, business partners, and customers for their support and contributions[85] - The board of directors includes independent non-executive directors Yang Jia Hong and Dai Xiao Jing[85] - The executive directors consist of Wu Zhi Xiang (co-chairman), Ma Ping (CEO), and Han Yu Ling[86]

Investment Rating - The report initiates coverage with a "Buy" rating for Tongcheng Travel [4]. Core Views - Tongcheng Travel is positioned as a leading OTA in the lower-tier market, focusing on strengthening its own supply chain to enhance competitive advantages [1][2]. - The online travel market in China is expected to reach a scale of 2.2 trillion yuan in 2024, recovering to 120% of the 2019 level, with an online penetration rate of 45.2%, indicating significant growth potential [2][31]. - The company benefits from strong backing by Tencent and Ctrip, which enhances its competitive edge through resource sharing and flow support [2][14]. Summary by Sections Company Overview - Tongcheng Travel was formed through the merger of Tongcheng and eLong, ranking among the top three online travel platforms in China, with a focus on the lower-tier market and supply chain development [1][9]. Industry Analysis - The online travel market is projected to grow significantly, with a stable competitive landscape dominated by a few major players. The penetration rate for online travel remains lower compared to other sectors, suggesting room for growth [2][26][34]. - The company is actively expanding its user base in lower-tier cities, with 87% of registered users from non-first-tier cities as of Q2 2024 [2][34]. Competitive Advantages - Tongcheng Travel leverages Tencent's traffic and Ctrip's inventory to enhance its market position. The company is also diversifying its traffic channels and strengthening its app development [2][3][14]. - The company has established a robust supply chain, including partnerships with travel agencies and hotel management companies, to enhance its service offerings [2][3]. Financial Performance and Forecast - The company reported a revenue of 11.896 billion yuan in 2023, with a growth rate of 81%. The adjusted net profit for 2023 was 1.554 billion yuan, marking a significant recovery post-pandemic [3][17]. - Forecasts for adjusted net profits from 2024 to 2026 are 2.6 billion yuan, 3.1 billion yuan, and 3.6 billion yuan, respectively, with corresponding P/E ratios of 14, 12, and 10 [3][4].

Tongcheng Travel Holdings Limited 同程旅行控股有限公司 (Incorporated in the Cayman Islands with limited liability) (於開曼群島註冊成立的有限公司) Stock Code 股份代號：0780 MALIGAYANG BENVENUTO PAGDATING TERVETULOA VELKOMMEN WELKOM 欢 迎 ÜDVÖZLÖM BIENVENIDO 환영 ようこそ WELCOME ... BIENVENUE WILLKOMMEN BEM-VINDOS 2024 中期報告 INTERIM REPORT CONTENTS 目錄 2 CORPORATE INFORMATION 公司資料 6 KEY HIGHLIGHTS 摘要重點 11 BUSINESS REVIEW AND OUTLOOK 業務回顧與展望 16 MANAGEMENT DISCUSSION AND ANALYSIS 管理層討論及分析 33 CORPORATE GOVERNANCE AND OTHER INFORMATION 企業管治及其他資料 84 R ...

[Table_MainInfo] 公司研究/旅游服务业 证券研究报告 [Table_InvestInfo] 投资评级 优于大市 维持 | --- | --- | |----------------------------------------------------------------|-------------| | 股票数据 | | | 09 [ Table_StockInfo 月 03 日收盘价（港元 ] ） | 15.02 | | 52 周股价波动（港元） | 12.38-22.55 | | 总股本 / 流通股本（百万股） | 2325/2325 | | 总市值 / 流通市值（亿港元） | 349/349 | | 相关研究 | | | [Table_ReportInfo] 《 OTA 行业龙头，多元场景加深下沉优势》 | | | 2024.04.10 | | 市场表现 [Table_QuoteInfo] | --- | --- | --- | --- | |--------------------------|-------|-------|--------| | 恒生指数对比 | 1M | 2 ...