HK&S HOTELS(HK:00045) Sou Hu Cai Jing·2025-06-29 03:51Core Viewpoint - Lihua Hotel has signed a strategic cooperation agreement with Shanxi Xinjinshang Winery Group to manage the Fenxing Hotel, aiming to develop it into a business resort brand in Shanxi [1][3][5]. Group 1: Strategic Cooperation - The partnership will leverage Lihua Hotel's management expertise and the unique resources of Fenxing Hotel, including its geographical location and cultural heritage, to enhance service quality and brand influence [3][6]. - The collaboration is part of Lihua Hotel's strategy to explore brand operation models in different locations, following its initial management output project with Yanmenguan Wangjiu Fort [5][11]. Group 2: Company Background - Shanxi Xinjinshang Winery Group, established in 2009, has evolved from the Fenxing Distillery founded in 1979, becoming a comprehensive group involved in winery operations, hotel management, and cultural promotion [5][6]. - Lihua Hotel, operational since 2008, is a key government reception hotel in Shanxi, recognized as a five-star and green hotel, with projected revenue of 289 million yuan for 2024 [6][7]. Group 3: Industry Context - The hotel industry is facing a downturn, with average occupancy rates dropping from 61.31% in 2023 to 58.81% in 2024, and average daily rates (ADR) decreasing from over 210 yuan to 199.92 yuan [7]. - In response to industry challenges, Lihua Hotel has initiated a light asset development strategy, focusing on brand building and operational management to mitigate risks associated with fixed asset investments [11].