SSAW Hotels(301073) Huaxin Securities·2025-05-25 02:05Investment Rating - The report assigns a "Buy" investment rating for Junting Hotel (301073.SZ) [1][9] Core Views - The company is experiencing operational pressure during its ramp-up phase, with regional performance showing continued divergence [2] - The focus is on the progress of direct-operated stores and the acceleration of franchise expansion [3] - Profitability is expected to improve as the direct-operated business ramps up and the franchise model operates with lower asset intensity [4] Summary by Sections Financial Performance - In 2024, total revenue reached 676 million yuan, a year-on-year increase of 27%, while net profit attributable to shareholders was 25 million yuan, a decrease of 17% [1] - For Q1 2025, total revenue was 162 million yuan, a slight increase of 1%, but net profit dropped by 39% to 3 million yuan [1] Operational Metrics - In 2024, the company's occupancy rate (OCC), average daily rate (ADR), and revenue per available room (RevPAR) decreased by 4 percentage points, 1%, and 7% respectively [2] - For Q1 2025, OCC, ADR, and RevPAR further declined to 56.51%, 471.8 yuan, and 266.6 yuan, reflecting a more significant drop due to various economic pressures [2] Expansion Strategy - The company has invested in 11 new direct-operated hotels, with 10 already opened, and is focusing on the ramp-up speed and stable profitability of these new openings [3] - A joint venture, Junxing Hotel Management, was established in December 2024, and the franchise model is set to launch in 2025, covering major urban clusters [3] Profit Forecast - The company is projected to achieve earnings per share (EPS) of 0.38 yuan in 2025, with a corresponding price-to-earnings (P/E) ratio of 55 times [4][11] - Revenue is expected to grow from 777 million yuan in 2025 to 1,004 million yuan in 2027, with net profit forecasted to increase significantly in the coming years [11][12]