Core Viewpoint - Haiyou, a budget hotel brand under Huazhu Group, aims to achieve a "thousand-store scale" by enhancing its product offerings and operational efficiency, despite previous setbacks in expansion [1][6]. Group 1: Business Strategy and Expansion - Haiyou previously set a goal to expand from 464 stores in 2020 to 1,500 by the end of 2023, but has only added about 230 stores, reaching over 700 by August this year [1][6]. - The CEO of Huazhu Group acknowledged that Haiyou initially limited its target audience to younger demographics, neglecting a broader market that includes middle-aged and older customers [1]. - Haiyou has introduced a new product, the fully self-service hotel, moving away from previous iterations to better meet market demands [1][5]. Group 2: Product Offering and Customer Experience - The fully self-service model aims to drastically reduce labor costs while reallocating savings to enhance room quality, positioning itself against higher-end brands like All Seasons [2][5]. - Haiyou's new offerings include larger room sizes, ergonomic mattresses, and improved amenities, all while maintaining cost efficiency [5][10]. - The self-service model allows guests to check in quickly and access various facilities independently, promoting a balance between efficiency and customer service [8][10]. Group 3: Market Trends and Consumer Behavior - Consumer preferences are shifting towards value-driven accommodations, with a notable trend of travelers opting for budget-friendly options, even unconventional ones like camping [7][8]. - Traditional budget hotels face challenges due to outdated offerings and inflated pricing, creating a gap in the market that Haiyou aims to fill with its innovative model [8][10]. - Data indicates that the fully self-service hotel model is gaining traction, with several locations achieving high occupancy rates and revenue per available room (RevPAR) exceeding 230 yuan [10][11]. Group 4: Investment Potential - The fully self-service hotel model is characterized by low investment costs, with a new single room costing approximately 57,100 yuan, making it an attractive option for investors [10]. - The operational efficiency of the self-service model allows for a significantly reduced staff-to-room ratio, enhancing profitability [10][11]. - Haiyou's approach is positioned as a "king of investment efficiency" in the budget hotel sector, promising high returns with minimal investment [10][11].

Core Viewpoint - The launch of the new brand image partner, the "Kelele Bear," by the high-end hotel brand Shijia Ge under Huazhu Group, marks a significant step in connecting emotionally and artistically with Chinese consumers, leveraging nearly a century of German heritage [2][12]. Group 1: Brand Identity and Cultural Significance - The Kelele Bear is designed as an artistic bear figure that embodies deep German cultural roots while presenting a warm and soft exterior, challenging the stereotype of German rigidity [4]. - The bear symbolizes strength and friendliness, particularly in Berlin, where it is seen as a city emblem, thus enhancing the brand's cultural relevance [4]. Group 2: Collaboration with Artists - International young artist Ye Zile was invited to co-create the Kelele Bear, known for his works that blend pop colors with healing aesthetics, showcasing broad international influence [5]. - The design process took nearly two years, resulting in a unique visual expression that abstractly represents the flow of energy through time and space [8]. Group 3: Long-term Vision and IP Integration - A groundbreaking 40-year cooperation agreement was established between Shijia Ge and Ye Zile, highlighting the brand's long-term vision in cultural development [8]. - The Kelele Bear will be integrated into the guest experience across all Shijia Ge hotels, featuring installations, themed rooms, customized meals, and merchandise, creating an immersive IP experience [10]. Group 4: Art Installations and Exhibitions - The first silver mirror sculpture of the Kelele Bear was unveiled at the Guizhou Xiaoqikong Shijia Ge Hotel, with plans for global guests to encounter this artistic installation [11]. - The "Kelele Bear World Tour" interactive exhibition commenced in Chengdu, showcasing the brand's nearly century-long journey from Germany to China, emphasizing the connection to Chengdu as the "Panda Capital" [12][15].

Group 1: Market Movements - Wanda Hotel Development (00169) saw a significant increase, rising over 20% during trading, attributed to an agreement with Sony's CPE for a 49% stake in Vampire Squid Productions, which operates the "Octonauts" IP [1] - Cat's Eye Entertainment (01896) rose over 5.3% following the announcement of the film "Demon Slayer: Infinity Castle Chapter One" set to release on November 14, with over 142,000 new views recorded on the platform [1] - Baidu Group-SW (09888) increased by 6.6% after its subsidiary reported over 250,000 orders completed by fully autonomous vehicles, marking a significant step in the commercialization of autonomous driving [1] - Semiconductor stocks experienced gains, with Huahong Semiconductor (01347) up 2.14%, Shanghai Fudan (01385) nearly 1%, and SMIC (00981) up 1.37%, driven by a continued demand for memory chips and price increases planned by several manufacturers [1] Group 2: Gold and Oil Stocks - Gold stocks continued to decline, with Lingbao Gold (03330) down 4.46% and China Gold International (02099) down 2.41%, as spot gold prices fell below $3,980 per ounce, a drop of over 9% from the high on October 20 [2] - Oil stocks rose, with PetroChina (00857) up 3.14% and Sinopec (00386) up 1.66%, following OPEC+'s announcement to pause production increases in Q1 2024, leading Morgan Stanley to raise its short-term oil price forecast [3] Group 3: Automotive and Technology Developments - Li Auto-W (02015) fell 3.3%, with a reported 38% year-on-year decline in new car deliveries for October, alongside a recall announcement for the MEGA 2024 model due to coolant issues [3] - Hesai Technology (02525) rose over 2% after announcing a strategic partnership with Guanghetong to develop a multi-modal perception and control solution based on lidar technology [3] Group 4: US Market Highlights - Atour (ATAT.US) increased by over 5.8%, supported by China's 14th Five-Year Plan aimed at boosting consumption [5] - NIO (NIO.US) rose over 2.3% with a 92.6% year-on-year increase in new car deliveries for October [5] - Micron Technology (MU.US) gained over 4.8% as Samsung paused DDR5 DRAM contract quotes, impacting the supply chain [5] - Nokia (NOK.US) rose over 3.4% following a $1 billion investment from Nvidia to accelerate AI-RAN innovations [6]

Core Viewpoint - Huazhu Group's stock rose nearly 6% in early trading, reflecting positive market sentiment following the announcement of a new brand and growth strategy at the 2025 Huazhu Partners Conference [1] Company Developments - Huazhu Group launched a new brand called "All Season Grand View" during the conference, emphasizing its commitment to innovation and brand expansion [1] - The founder and chairman, Ji Qi, highlighted favorable factors for the hotel industry in China, including a large population base, significant infrastructure development, and opportunities in cultural tourism [1] Industry Outlook - According to CICC, Huazhu Group is actively pursuing brand upgrades and scale expansion, with a target of reaching 20,000 hotels by 2030 and potentially 50,000 to 60,000 in the long term [1] - The company is focusing on deepening its presence in mid-range and lower-tier cities, enhancing profitability through a franchise model [1] - CICC maintained its profit forecasts for 2025 and 2026, raising the target price to $48 due to the anticipated upward shift in industry valuations [1]

Core Viewpoint - Huazhu Group's stock price increased by nearly 6% following the announcement of a new brand, highlighting positive market sentiment and growth potential in the hotel industry in China [1] Company Developments - Huazhu Group launched a new brand called "All Seasons Grand" during the 2025 Huazhu Partners Conference, emphasizing its commitment to brand innovation and expansion [1] - The CEO of Huazhu Group's Brand Division, Shen Yijun, and Chief Designer, Zhou Guangming, presented the new brand at the conference [1] Industry Insights - Huazhu Group's founder and chairman, Ji Qi, identified key favorable factors for the hotel industry in China, including a large population base, significant infrastructure development, extensive market depth, and a booming cultural tourism sector [1] - The company is focusing on supply-side reforms as the biggest opportunity for the future of the hotel industry in China [1] Growth Projections - CICC forecasts that Huazhu Group will continue its brand upgrade and scale expansion, aiming to reach 20,000 hotels by 2030, with a long-term target of 50,000 to 60,000 hotels [1] - The company is deepening its presence in mid-range and lower-tier cities, enhancing profitability through a franchise model [1] - CICC has maintained its profit forecasts for 2025 and 2026, raising the target price to $48 due to the benefits from industry valuation increases [1]

Summary of China Travel & Leisure Industry Conference Call Industry Overview - The conference call focused on the **China travel and leisure industry**, particularly the performance of various companies in the sector during **3Q25** [1][2]. Key Points and Arguments General Market Trends - **Weaker Disposable Income**: Disposable income growth slowed to **4.5%** in 3Q25 from **5.1%** in 2Q25, impacting consumption trends which fell to **3.4%** from **5.2%** [2][3]. - **Domestic Air Traffic**: Increased by **3%** year-over-year (yoy) in 3Q25, down from **6%** in 2Q25 [2]. - **Outbound Travel**: Normalized to **15%** yoy growth, significantly lower than **34%** and **24%** in 1Q and 2Q25 respectively, as flight capacity returned to pre-pandemic levels [2]. Company Performance Highlights - **Songcheng**: Reported a **10%** yoy revenue decline due to competition and health issues [3]. - **CTGDF**: Revenue decline narrowed to flat yoy in 3Q25 from **-11%** and **-8%** in previous quarters, with a **14%** increase during the Golden Week holidays [3][6]. - **Jinjiang and BTG**: RevPar improved to declines of **-2%** and **-3%** yoy, respectively, compared to **-5%** and **-6%** in 2Q25 [3][6]. - **Chinese Airlines**: Benefited from lower fuel costs and traffic recovery, with domestic traffic up **13%** and international traffic up **11%** [6]. - **Shiji**: Revenue increased by **7%** yoy, but net loss widened to **Rmb12 million** due to higher impairment losses [6]. Macau Casino Performance - **Macau GGR**: Increased by **13%** yoy in 3Q25, up from **8%** in 2Q25, driven by factors such as the wealth effect from the stock market and reduced diversion of travelers to other destinations [7]. - **Sands China and MGM**: Results exceeded expectations, with Sands China expected to report **US$1.901 billion** and MGM **US$1.091 billion** in revenue for 3Q25 [7][10]. Samsonite Expectations - Expected to report a narrower revenue decline of **-2%** yoy in 3Q25, improved from **-5%** in 2Q25, driven by better performance in the US and Asia [7][10]. Hotel Operators - **H World and Atour**: Both expected to report better-than-expected results due to stabilizing hotel RevPar and robust retail sales growth [7][10]. - **RevPar Forecasts**: H World and Atour projected declines of **-0.4%** and **-3%** yoy, respectively, with revenue growth forecasts of **+7%** and **+35%** yoy [8][10]. OTA Performance - **Trip.com and Tongcheng**: Expected to meet revenue guidance with Trip.com projected to grow **+15%** and Tongcheng **+9%** [9][10]. - **Profit Margins**: Potential for improved profit margins due to favorable revenue mix shifts towards higher-margin businesses [9]. Other Important Insights - **Investor Focus**: Investors are expected to pay close attention to companies' forward guidance during their 3Q25 results to assess the sustainability of the recovery [2][10]. - **Valuation Considerations**: Despite recent performance, share prices of US-listed chain hotels are still trading below mid-cycle valuations, indicating potential for upward earnings revisions [10][11]. Conclusion - The China travel and leisure industry is showing signs of recovery, although challenges remain due to weaker consumer spending and competition. Companies like H World, Atour, and TCOM are positioned well for growth, while Macau casinos are benefiting from a rebound in gaming revenue. Investors should remain cautious but optimistic about the sector's trajectory moving forward.

Core Viewpoint - The hotel industry in China has significant growth potential, and the next 20 years will focus on redefining the sector with an emphasis on supply-side reforms [1][2][9]. Company Overview - Huazhu Group has risen from fifth to fourth in the 2024 global hotel group rankings, with 1.11 million rooms and 108.82 thousand hotels, surpassing InterContinental Hotels Group [1][4]. - As of June 30, 2025, Huazhu operates 12,100 hotels across 19 countries, with 1.1849 million rooms [6][7]. - The company has nearly doubled its hotel count and operational rooms over the past five years [7]. Industry Insights - The chain hotel rate in China is approximately 40%, indicating substantial opportunities for growth in the sector, particularly in lower-tier cities [3][9]. - The hotel market is experiencing a shift towards supply-side reforms, including a transition from single hotels to chain hotels and from high-end to brand hotels [9]. - The second quarter of 2025 saw Huazhu report hotel revenues of 26.9 billion yuan, a 15% year-on-year increase, with adjusted net profit rising by 7.6% to 1.35 billion yuan [10].

Core Viewpoint - The article highlights the positive market response of hotel stocks, specifically Atour (ATAT.US) and Huazhu (HTHT.US), following the announcement of China's 14th Five-Year Plan, which aims to boost consumption and service sectors [1] Group 1: Market Performance - Atour (ATAT.US) shares increased by over 4% [1] - Huazhu (HTHT.US) shares rose by over 2% [1] Group 2: Policy Implications - The 14th Five-Year Plan emphasizes the implementation of special actions to stimulate consumption and expand the supply of quality consumer goods and services [1] - Key focuses include easing market access, integrating business formats, enhancing brand leadership, upgrading standards, and applying new technologies to promote the expansion and upgrading of goods consumption [1] Group 3: Investment Opportunities - Huachuang Securities suggests that China's service consumption is currently in a transformative phase, with strong policy support indicating that service consumption could become a key investment theme [1] - The report recommends paying attention to hotel groups that are showing improvements in operational margins [1]

Core Insights - The core message of the event was a strong endorsement of the Chinese hotel industry, emphasizing a positive outlook for the future and the importance of supply-side reforms in driving growth [1][12][16] Company Overview - Huazhu Group has achieved significant milestones, including 300 million members and operations in over 12,000 hotels across 19 countries, ranking fourth globally among hotel groups [8][10] - The company has established a comprehensive brand matrix covering various market segments, with high repurchase rates among franchisees and leading performance metrics in the industry [8][10] New Brand Launch - The new brand "All Seasons Grand View" was introduced, focusing on a lifestyle approach that integrates Eastern aesthetics into the hospitality experience, aiming to create a unique cultural and aesthetic experience for guests [6][10] Market Position and Strategy - Huazhu's growth strategy is centered on three key pillars: deepening focus on the Chinese market, leveraging a triadic model of brand, membership, and technology, and pursuing high-quality growth [11][12] - The company is positioned to capitalize on the ongoing transformation in the hotel industry, moving from rapid expansion to a focus on quality and efficiency [10][15] Industry Trends - The Chinese hotel industry is undergoing a significant transformation, with opportunities arising from market pressures, the rise of franchising, advancements in AI technology, and the potential in lower-tier cities [15][16] - The current state of the industry presents a chance for supply-side reforms, addressing issues of fragmentation and homogeneity in the market [15][16]

Core Viewpoint - The economic hotel sector is experiencing a collective retreat, with major players like Jinjiang, Shoulv, and Huazhu shifting focus towards mid-to-high-end hotels, indicating a decline in the economic hotel segment's viability [7][9][40]. Group 1: Industry Trends - Economic hotels, represented by brands like Buding, are struggling, with key performance indicators such as RevPAR declining year-on-year [6][9]. - By the end of 2024, the proportion of economic hotel rooms is expected to drop to 54%, with major hotel chains adding significantly fewer economic hotels compared to mid-to-high-end options [7][38]. - The average room rates for major hotel chains have been rising, contrasting with the stagnant performance of economic hotels [8][38]. Group 2: Market Dynamics - The hotel industry operates on a model similar to airlines, where fixed costs are high, and revenue is highly dependent on occupancy rates [11]. - Economic hotels face inherent vulnerabilities due to limited pricing power and low elasticity of demand, making them less competitive against mid-to-high-end hotels [13][14]. - The trend towards consolidation in the hotel industry has led to increased market concentration, with the top three hotel groups controlling 75% of the market by 2016 [27][32]. Group 3: Consumer Behavior - There is a growing consumer preference for mid-to-high-end hotels, which offer more amenities and services, leading to higher occupancy rates compared to economic hotels [42][46]. - The rise of online travel agencies (OTAs) has created a complex relationship with hotels, but both parties benefit from the shift towards mid-to-high-end offerings [48]. - Economic hotels are increasingly losing market share as consumer spending shifts towards higher-quality accommodations, especially in a recovering economy [49][50]. Group 4: Future Outlook - The economic hotel segment is expected to continue facing challenges, with many operators struggling to adapt to changing market conditions and consumer preferences [20][40]. - Predictions suggest that mid-range hotels will dominate the market in the coming years, reshaping the competitive landscape of the hotel industry [52].