Core Viewpoint - Huazhu Group reported a revenue of 11.8 billion yuan for the first half of 2025, a year-on-year increase of 3.5%, and a net profit of 2.4 billion yuan, up 41.2% year-on-year, indicating resilience despite industry challenges [1][2]. Financial Performance - In Q2 2025, Huazhu achieved a revenue of 6.4 billion yuan, a 4.5% increase year-on-year, with adjusted net profit reaching 1.35 billion yuan, up 7.6% [1][2]. - The total transaction volume (GMV) for the group reached 26.9 billion yuan, reflecting a 15% year-on-year growth [2]. - The number of hotels in operation increased to 12,137, a growth of 18% year-on-year, with total rooms reaching 1,184,915, up 18.3% [1][2]. Business Strategy - Huazhu's strategy focuses on expanding into new cities and regions, particularly in lower-tier cities, to achieve high-quality network expansion [1][2]. - The company opened 597 new hotels in Q2, with economy and mid-range hotels making up 44% and 42% of the new openings, respectively [1][2]. Revenue Breakdown - Revenue from management and franchise hotels was 5.4 billion yuan, a 22% increase, accounting for 45.4% of total revenue, up from 38.5% in the same period last year [2]. - The revenue from leased and owned hotels was 6.2 billion yuan, a decline of 8.7%, with Huazhu China specifically seeing a 10.3% drop [2]. Market Dynamics - The overall RevPAR (Revenue per Available Room) for Huazhu decreased by 7.9% to 233 yuan, with occupancy rates dropping by 2.9 percentage points to 81.1%, indicating increased market competition and weak demand [3]. - The company anticipates a slight decline in RevPAR for the full year due to increased hotel supply and weaker consumer sentiment, but aims to meet its revenue guidance through product upgrades and sales enhancements [4]. Brand Development - Huazhu's HanTing brand ranked first in the latest "Top 50 Hotel Brands" list, while its Orange Hotel brand surpassed 1,000 locations, positioning itself as a second growth engine in the mid-range market [5]. - The company is leveraging the current real estate market downturn to acquire prime properties in first and second-tier cities for new high-end hotel developments [5].

Core Viewpoints - The company achieved a revenue of 6.426 billion yuan in Q2 2025, a year-on-year increase of 4.5%, and a net profit attributable to shareholders of 1.544 billion yuan, up 44.7% year-on-year [1] - Adjusted net profit reached 1.349 billion yuan, reflecting a year-on-year growth of 7.6%, with overall operational efficiency and store openings remaining stable [1] - The company continues to advance asset-light strategies and brand upgrades, with improvements in the mid-to-high-end matrix and supply chain optimization [2] Financial Performance - Q2 2025 revenue growth was close to the previous guidance of 1% to 5%, with management franchise revenue at 2.865 billion yuan, up 22.8%, exceeding the prior guidance of 18% to 22% [1] - Legacy-Huazhu revenue was 5.107 billion yuan, a 5.8% increase, falling within the guidance range of 3% to 7% [1] - Overall GMV reached 26.9 billion yuan, a year-on-year increase of 15% [1] Operational Metrics - The adjusted EBITDA for Q2 was 2.270 billion yuan, an 11.3% increase, with Legacy-Huazhu contributing 2.090 billion yuan, up 9.5% [1] - The operating profit for DH improved significantly, with a 52.7% increase, driven by an 8.1% rise in RevPAR [1] - The overall hotel operating cost ratio was 58.4%, a decrease of 2.3 percentage points year-on-year, with rent costs down by 1.5 percentage points [1] Store Expansion and Strategy - In Q2, the company opened 597 new stores, with a net increase of 452 stores, maintaining a steady pace of expansion [1] - The mid-range hotel brand, Juzi, has surpassed 1,000 locations, indicating potential for growth in the mid-tier segment [2] - The company aims to maintain its annual store opening target without adjustments [1] Brand and Supply Chain Development - The company is focusing on brand upgrades, recently launching Hanting 4.0, which aims to optimize costs and improve quality and efficiency [2] - Franchise revenue contributed 64% to the overall operating profit, with a year-on-year increase of approximately 10.5 percentage points [2] - Supply chain enhancements are expected to yield a 10% to 20% reduction in procurement costs for furniture, soft furnishings, and construction materials [2]

Core Viewpoint - The company reported stable revenue growth and a significant increase in net profit for Q2 2025, driven by its hotel operations and strategic focus on franchise business expansion [1][2][4] Group 1: Financial Performance - Q2 hotel revenue reached approximately 26.92 billion yuan, a year-on-year increase of 15.0%, with Huazhu China growing by 15.6% [1] - Q2 revenue was 6.43 billion yuan, up 4.5% year-on-year, aligning closely with the previous guidance of 1-5% [1] - Net profit attributable to shareholders was 1.54 billion yuan, a year-on-year increase of 44.7%, aided by foreign exchange gains from euro appreciation [1] - Adjusted net profit was 1.35 billion yuan, reflecting a 7.6% year-on-year growth, while adjusted EBITDA grew by 11.3% [1] Group 2: Business Strategy and Operations - The company is focusing on franchise business growth, with franchise revenue increasing by 22.8% in Q2, while the number of franchise rooms grew by 20.0% year-on-year [2] - Total operating profit from franchise operations rose by 23.2%, contributing 64% to the overall profit, an increase of 7 percentage points [2] - The company is strategically reducing the number of direct-operated stores, which saw a revenue decline of 7.6% and an operating profit drop of 13.4% [2] Group 3: Market Trends and Future Outlook - Q2 mixed RevPAR for Huazhu China was 235 yuan, down 3.8% year-on-year, with same-store RevPAR decreasing by 7.9% [3] - The company is actively renovating older stores and launching new brands, with a focus on high-quality hotel development [3] - The company has adjusted its full-year RevPAR expectations to a low single-digit decline, while maintaining revenue growth projections of 2%-6% [4] - The company has approved a semi-annual dividend policy totaling 250 million USD, alongside share buybacks, representing 92% of the net profit for the first half of the year [4]

华住集团首席执行官金辉表示："二季度公司延续了规模与盈利的双轨增长。面对市场供给增加的 压力，我们仍保持较高的入住率，展现出强劲的运营韧性。" 金辉透露，未来将通过对老产品的持续升级迭代，以及加强收益管理和本地营销能力，推动单店 RevPAR的增长。 截至上半年，华住集团在营酒店总数达12137家，同比增长18%；在营客房总数1184915间，同比增 加18.3%。 报告期内，集团新开业酒店597家，其中经济型酒店和中档酒店占比分别达44%、42%。待开业酒 店2947家，期末运营中及待开业酒店合计覆盖城市达1522个。 8月20日，华住集团发布2025年第二季度财务业绩。 财报显示，今年二季度华住集团的酒店营业额269亿元，同比增长15%。同期，集团收入达64亿 元，同比增长4.5%，经调整净利润13.5亿元，同比增长7.6%，经调整EBITDA（息税折旧及摊销前利 润）23亿元，同比增长11.3%。 ...

Core Viewpoint - The hotel industry is transitioning from a phase of "revenge spending" to a more rational consumption pattern, leading to intensified competition and reduced availability of "low-hanging fruit" for hotel companies. In this context, Huazhu Group has demonstrated strong internal growth factors and is advancing towards higher quality growth through product iteration, operational optimization, and cost control [1][4]. Financial Performance - In Q2 2025, Huazhu Group reported hotel revenue of 26.9 billion yuan, a year-on-year increase of 15%. The group's total revenue reached 6.4 billion yuan, up 4.5%, with adjusted net profit at 1.35 billion yuan, reflecting a 7.6% increase. Adjusted EBITDA was 2.3 billion yuan, growing by 11.3% [2]. Market Context - The hotel industry in China has seen significant growth, with the number of hotel establishments rising from 252,400 in 2021 to 348,700 in 2024, an increase of nearly 100,000 [4]. - Consumer sentiment has shifted towards rationality, emphasizing value for money, which has intensified competition in the market [4]. Key Operational Metrics - In Q2 2025, Huazhu's RevPAR (Revenue per Available Room) was 235 yuan, 96.2% of the same period in 2024. The ADR (Average Daily Rate) was 290 yuan, at 98.1% of the previous year, and the occupancy rate was 81%, down from 98.4% [5]. - In contrast, the overall Chinese hotel market saw a 5% decline in RevPAR during the same period, indicating Huazhu's strong performance relative to the market [5]. Competitive Advantages - Huazhu Group maintains a diverse brand matrix with over 30 sub-brands, focusing on economy and mid-range hotels, which positions it well in a market where consumers are increasingly price-sensitive [8]. - The company has expanded its hotel network to 12,137 properties, an 18% increase year-on-year, and has enhanced its presence in mid-to-high-end segments, with a 23.3% growth in mid-to-high-end properties [11]. Membership and Customer Engagement - Huazhu's membership base grew by 17.5% to 288 million, with member booking nights increasing by 28.8% in Q2 [12]. Supply Chain and Franchise Support - Huazhu introduced nine service commitments to franchisees, enhancing procurement reliability and setting new industry standards. This includes commitments to quality, pricing, and service efficiency [13]. - The company’s strong supply chain capabilities allow for cost reductions and improved service quality, which supports franchisee profitability [13]. Future Outlook - Analysts suggest that despite a slight decline in RevPAR in Q3, the strong leisure travel demand and Huazhu's extensive membership system position the company favorably for future growth, maintaining a "strongly recommended" rating [15].

Group 1: Hong Kong Stocks Performance - Miniso (09896) surged over 20% after reporting a 10% year-on-year increase in adjusted net profit for Q2, with TOP TOY revenue skyrocketing by 87.0% [1] - Li Ning (02331) rose over 6% as it announced a 3.3% year-on-year increase in revenue and declared an interim dividend of HKD 0.3359 per share [1] - Innovent Biologics (02096) increased by over 6% following a 26% year-on-year growth in innovative drug revenue, expanding its commercialized innovative drug portfolio to ten products [1] - Tuhu-W (09690) gained over 10% after reporting a 14.6% year-on-year increase in adjusted net profit while continuing to optimize supply-side costs [1] - Kuaishou-W (01024) rose over 4% with impressive Q2 results and accelerated commercialization [1] - UBTECH (09880) increased over 3% as it led the establishment of two national technical standards for humanoid robots [1] - InnoCare Pharma (02577) saw a rise of over 5% after announcing a partnership with NVIDIA [1] Group 2: Other Notable Performances - China Communications Services (00552) fell over 2% despite a slight 0.18% year-on-year increase in net profit attributable to shareholders, with stable development among its three major clients [2] - Parkson Group (03368) surged nearly 25% after reporting a turnaround to profitability in the first half of the year and proposing an interim dividend of HKD 0.02 per share [2] - Esprit Holdings (00330) jumped over 37% after issuing a profit warning, expecting a net profit of approximately HKD 1 million for the six months ending June 30, 2025 [2] - XPeng Motors (09868) rose over 10% as CEO He Xiaopeng increased his stake by purchasing 3.1 million Class A ordinary shares at an average price of HKD 80.49 per share [2] Group 3: US Market Highlights - Coty (COTY.US) plummeted 21.60% due to weak performance in the US market, retailer destocking, and consumers seeking value, impacting Q4 results [3] - NIO (NIO.US) increased by 9.27% ahead of the launch of its new ES8 product and the start of pre-sales [3] - Huazhu Group (HTHT.US) continued to rise by 2.19% with a 41.3% year-on-year increase in revenue and net profit, benefiting from management franchise and licensing business [3] - Boss Zhipin (BZ.US) rose 6.61% after reporting an over 85% year-on-year increase in net profit for the mid-year and extending its share buyback plan [3] - Youlan Group (YOUL.US) surged 17.13% after announcing plans to acquire four companies to expand its online recruitment and regional market share [3] - Hesai Technology (HSAI.US) increased by 11.00% amid market speculation about a potential IPO in Hong Kong to raise approximately USD 300 million [3] Group 4: Additional US Stock Movements - Miniso (MNSO.US) rose 6.38% after reporting a revenue of CNY 9.39 billion for the first half of the year, a year-on-year increase of 21.1%, with adjusted net profit of CNY 1.28 billion [4] - Walmart (WMT.US) fell 4.49% as Q2 adjusted earnings per share fell short of expectations due to increased insurance claims, legal fees, and restructuring costs [4] - Gilead Sciences (GILD.US) dropped 2.18% after CVS Health decided not to include Gilead's new HIV prevention drug Yeztugo in its business plans [4] - XPeng Motors (XPEV.US) rose 11.68% following the CEO's purchase of 3.1 million Class A ordinary shares [5] - Aegon (AEG.US) increased by 7.64% after reporting a turnaround to profitability in the first half of 2025, primarily driven by growth in its US business [5]

证券研究报告 | 2025年08月22日 华住集团-S（01179.HK） 优于大市 二季度业绩稳健增长，巩固轻资产战略与高质量扩张 二季度收入符合预期，利润稳健增长。2025Q2 公司酒店营业额约 269.2 亿 元，同比增长 15.0%；其中华住中国同比增长 15.6%。Q2 公司营收 64.3 亿元，同比增长 4.5%（靠近此前指引 1-5%上限）；归母净利润 15.4 亿 元，同比增长 44.7%（欧元升值带来外汇收益同比增加 3.9 亿）；经调 整净利润 13.5 亿元，同比增长 7.6%；经调整 EBITDA 同比增长 11.3%。 其中，华住中国分部营收为 51.1 亿元，同比增长 5.7%（此前指引 3-7%）； DH 收入为 13.2 亿元，同比增长 0.1%，经调整 EBITDA 同比增长 37%。 门店扩张驱动加盟业务增势良好，直营店战略性收缩存在负向经营杠杆。公 司本季度起披露直营与加盟业务利润拆分，Q2 开店驱动加盟收入同比增 长 22.8%，Q2 末在营酒店 1.2 万家/118 万间客房，加盟客房数同比增长 20.0%；对应总营业利润同比增长 23.2%，贡献集团总体 64%，同 ...

Group 1 - The company achieved revenue of 6.4 billion yuan in Q2 2025, a year-on-year increase of 4.5%, reaching the upper limit of the guidance growth rate of 1%-5% [1] - Net profit attributable to shareholders was 1.54 billion yuan, up 44.7%, driven by asset-light transformation, a 2.3 percentage point increase in gross margin, and foreign exchange gains of 435 million yuan, leading to a 6.6 percentage point increase in net profit margin [1] - Management franchise and licensing revenue reached 2.9 billion yuan, a year-on-year increase of 22.8%, exceeding the guidance growth rate of 18%-22% [1] Group 2 - The company opened 595 new stores in mainland China in Q2 2025, a year-on-year increase of 4.9%, with a net increase of 452 stores [1] - As of the end of Q2 2025, the total number of stores in mainland China reached 12,016, a year-on-year increase of 18.4%, with franchise stores accounting for 95.4% [1] - The company has a store reserve of 2,925, a quarter-on-quarter increase of 2.3%, actively working towards the annual guidance of opening 2,300 new stores and a net increase of 1,700 stores [1] Group 3 - The mainland RevPAR decreased by 3.8% to 235 yuan in Q2 2025, with occupancy rate down 1.6 percentage points to 81.0% and ADR down 1.9% to 290 yuan [2] - The company expects Q3 2025 revenue growth rate of 2%-6%, with a 4%-8% growth rate excluding the DH segment, and a franchise business revenue growth rate of 20%-24%, accelerating compared to Q2 2025 [2] - The company has issued a total of 550 million USD in dividends this year, corresponding to a dividend yield of 5.3% [2]

Investment Rating - The report maintains a "Strong Buy" rating for the company [3][6]. Core Insights - The company reported Q2 2025 revenue of 6.43 billion yuan, a year-on-year increase of 4.5%, aligning with the guidance of 0%-5% [1][6]. - Adjusted EBITDA and net profit for Q2 2025 were 2.27 billion yuan and 1.35 billion yuan, respectively, reflecting year-on-year growth of 11.3% and 7.6% [1][6]. - The company anticipates Q3 2025 revenue growth of 2%-6%, with domestic hotel revenue expected to grow by 4%-8% [1][6]. Financial Performance - The company achieved a gross margin of 41.6%, an increase of 2.3 percentage points year-on-year [6]. - The operating profit margin for Q2 2025 was 27.8%, up by 2.2 percentage points year-on-year [6]. - The company’s total revenue for 2023 is projected at 21.882 billion yuan, with a year-on-year growth of 58% [2][8]. Operational Metrics - The number of domestic hotels reached 12,016, representing an 18.4% increase year-on-year [6]. - The company has a robust pipeline with 2,947 hotels awaiting opening, sufficient to support its annual opening plan [6]. - The overall hotel occupancy rate, average daily rate, and RevPAR showed a slight decline, with year-on-year changes of -1.6 percentage points, -1.9%, and -3.8%, respectively [6]. Shareholder Information - The total share capital is 3,069 million shares, with a market capitalization of 80.7 billion HKD [3][6]. - The major shareholder, Qi Qi, holds a 31.21% stake in the company [3].

Core Insights - Huazhu Group reported a revenue of 11.8 billion yuan for the first half of 2025, a year-on-year increase of 3.5%, and a net profit of approximately 2.4 billion yuan, up 41.2% [1][4] - Key performance indicators in the Chinese market, including average daily rate (ADR), occupancy rate, and revenue per available room (RevPAR), showed a decline compared to the previous year [1][5] - Despite the challenges, Huazhu continues to expand aggressively, with a total of 12,137 stores as of mid-2025, an 18% increase year-on-year, and 2,947 additional stores in the pipeline [1][9] Financial Performance - In Q2 2025, Huazhu's revenue reached 6.4 billion yuan, a 4.5% increase year-on-year, with adjusted net profit of 1.35 billion yuan, up 7.6% [4] - Adjusted EBITDA for Q2 was 2.3 billion yuan, reflecting an 11.3% increase [4] - The operating profit for Q2 was 1.8 billion yuan, a 13.7% increase year-on-year [1] Market Conditions - The hotel industry is facing overall pressure, with STR reporting a 5% decline in average RevPAR for the industry in the first half of 2025 [8] - Huazhu's ADR was 290 yuan, down 1.9% year-on-year, and occupancy rate was 81%, a decrease of 1.6 percentage points [1][5] - RevPAR decreased by 3.8% to 235 yuan [1][5] Expansion Strategy - Huazhu's strategy involves rapid store openings, focusing on economy and mid-range hotels, with 595 new openings in Q2, 44% of which were economy hotels and 42% mid-range [8] - The company aims to balance the pace and quality of new store openings while upgrading existing stores [12][11] Business Segmentation - Huazhu's revenue from its Chinese operations was approximately 9.6 billion yuan, a 5.6% increase, contributing 81.4% to total revenue [14] - The international segment generated about 2.2 billion yuan, a decrease of 4.9%, accounting for 18.6% of total revenue [14] - The management franchise and licensing models are expanding, with 92% of hotel rooms operated under these models, up 2% year-on-year [17] Cost Management - Huazhu's hotel operating costs were 7.356 billion yuan, a 0.82% increase, while the cost per store decreased by 14.19% to 607,900 yuan [10] - The company has achieved a 10% to 20% reduction in procurement costs across various categories [10] Membership and Customer Engagement - As of Q2 2025, Huazhu's membership base reached 288 million, a 17.5% increase year-on-year [14] - The company upgraded its direct booking platform and membership club, introducing a dual guarantee feature to enhance customer service [14] Competitive Landscape - Huazhu ranks first among China's four major hotel groups in terms of revenue, with 23.891 billion yuan, but faces competition from faster-growing peers like Atour [18][20] - The company is also exploring retail opportunities, although results have yet to be significant [21]