JINJIANG HOTELS(SH:600754) Soochow Securities·2024-10-31 23:00Investment Rating - The investment rating for the company is "Buy" (maintained) [1] Core Views - The company reported Q3 2024 earnings that were below expectations, with revenue of 10.79 billion yuan, a year-on-year decrease of 3%, and a net profit attributable to shareholders of 1.11 billion yuan, a year-on-year increase of 12% [2] - The decline in RevPAR (Revenue per Available Room) for limited-service hotels in mainland China was a significant factor, with a decrease of 8% [3] - The company has opened 1,149 hotels in the first three quarters, indicating a strong expansion strategy, with a target of 1,200 openings for the year [4] - The company is expected to recover its profitability as business travel demand rebounds, despite a downward revision of profit forecasts due to the RevPAR decline [5] Financial Performance Summary - For Q3 2024, the company achieved a revenue of 3.90 billion yuan, down 7% year-on-year, and a net profit of 260 million yuan, down 43% year-on-year [2] - The average RevPAR for limited-service hotels in mainland China was 174 yuan in Q3, with an occupancy rate of 73.4% [4] - The company’s gross margin for Q3 was 43.4%, a decrease of 1.1 percentage points year-on-year, while the net profit margin was 2.6%, down 1.9 percentage points year-on-year [3] - The projected net profits for 2024, 2025, and 2026 are 12.42 billion yuan, 14.18 billion yuan, and 15.31 billion yuan, respectively [5]