Core Viewpoint - Tongcheng Travel's 3Q25 performance slightly exceeded market expectations, driven by strong hotel and other revenue growth [1] Performance Review - 3Q25 revenue increased by 10% to 5.51 billion yuan, slightly above market expectations by 0.5%, primarily due to better-than-expected hotel and other revenues [1] - Non-IFRS net profit reached 1.05 billion yuan, exceeding market expectations by 1.1%, with a Non-IFRS net profit margin of 19.1%, attributed to effective control of service development and management expenses [1] Development Trends - Domestic hotel occupancy rates for mid-to-high star hotels are increasing, with a 10-15% year-on-year growth in domestic hotel room nights in 3Q25, aligning with previous expectations [1] - Average Daily Rate (ADR) saw low single-digit year-on-year growth, influenced by changing consumer habits, while the supply of high-quality accommodations, such as three-star hotels, grew by 20% [1] - For 4Q25, hotel revenue is expected to grow by 15%, with domestic hotel room nights increasing by approximately 10% and ADR maintaining low single-digit year-on-year growth [1] - In transportation, domestic ticket volume growth in 3Q25 was similar to the overall market, with a focus on improving monetization rates, expected to continue into the next quarter, projecting an 8% year-on-year growth in transportation revenue for 4Q25 [1] - The outbound business maintained rapid growth, with outbound ticket revenue accounting for 6% of transportation revenue, up 2 percentage points year-on-year, achieving overall profitability in 3Q25 [1] - The company completed the acquisition of Wanda Hotel Management, which operates nearly 3,000 hotels and has 1,500 more in the pipeline, enhancing its hotel management business [1] Core OTA Profitability - Core OTA operating profit in 3Q25 was 1.44 billion yuan, with an operating profit margin of 31.2%, remaining stable compared to the same period last year [1] - Increased marketing investments during the summer peak season were offset by effective control of other fixed costs [1] - For 4Q25, Non-IFRS net profit is projected to be 740 million yuan [1] Profit Forecast and Valuation - The company maintains its revenue and profit expectations for 2025 and 2026, with a target price of 28 HKD, corresponding to 18x/15x 2025e/2026e Non-IFRS P/E, indicating a potential upside of 30% [2] - Current trading is at 14x/12x 2025e/2026e Non-IFRS P/E [2]
同程旅行(00780.HK)：出境业务较快增长；并购万达酒管布局产业链