CTG DUTY-FREE(SH:601888) Cai Fu Zai Xian·2025-12-18 02:47Core Insights - The official launch of the Hainan Free Trade Port's full island closure operation on December 18, 2025, marks a new phase in China's high-level opening-up strategy, driving growth in high-tech industries and modern services, particularly in the tourism retail sector [1][2] Policy and Strategic Developments - The implementation of a liberalized policy characterized by "open on the first line, controlled on the second line, and free within the island" aims to maximize the benefits of openness while ensuring safety and efficiency [2] - The Ministry of Finance, General Administration of Customs, and State Taxation Administration announced an upgrade to the duty-free shopping policy for travelers from November 1, 2025, adding two new product categories and optimizing three existing categories, which will enhance the international influence of domestic products and provide new opportunities for businesses [2] Company Positioning and Competitive Advantage - China Duty Free Group (CDFG) is positioned as a key player in the Hainan duty-free policy, focusing on "first store economy, new product launches, all-region marketing, and service upgrades" to stimulate consumer activity and transition from tourism retail to quality retail [4] - CDFG has established a comprehensive strategic layout, building core competitiveness across channels, supply chains, and membership operations to prepare for the new era of closure [5] Retail Network and Supply Chain - CDFG operates the most complete duty-free retail channels in China, with approximately 200 duty-free stores across over 100 cities, including major locations in Hainan [5][7] - The company has built long-term partnerships with around 1,600 well-known global brands, ensuring a stable supply of products and enhancing its competitive advantage through a robust logistics network [7] Membership and Customer Engagement - CDFG has developed a tiered membership system, increasing user conversion and repurchase rates, with membership exceeding 45 million by mid-2025, creating a strong and loyal customer base [8] Product and Experience Innovation - CDFG is enhancing its product offerings to meet diverse consumer demands, collaborating with top global brands for exclusive and limited products, and hosting events like the fifth CDFG Watch Festival to enrich the shopping experience [9][11] - The company is also focusing on the aging population by introducing health products and services tailored to older consumers, thereby injecting new vitality into tourism retail [11] Experience and Service Enhancement - CDFG is transforming its duty-free shopping spaces into comprehensive cultural and leisure destinations, integrating shopping with entertainment and social interaction to meet the growing demand for immersive consumer experiences [12][15] - The company is committed to providing high-quality service, with initiatives like customized services for high-end members and thoughtful amenities for travelers, enhancing the overall shopping experience [15] Future Outlook - CDFG aims to lead high-quality development in the tourism retail sector, leveraging the historical opportunity presented by the full closure operation to innovate and integrate various sectors, contributing to the establishment of Hainan as an international tourism consumption center [16]