SXLY(SZ:002627) GUOTAI HAITONG SECURITIES·2025-12-18 05:22Investment Rating - The report assigns a rating of "Buy" to the company with a target price of 9.45 CNY [5][16]. Core Insights - The company is expected to benefit from the recovery in demand and the advancement of its inter-provincial cruise project, which is anticipated to open new business growth and profit flexibility [2][12]. - The company aims to transition from a purely sightseeing model to a vacation-oriented model, enhancing overall customer spending and profit levels through the introduction of four inter-provincial cruise ships [12][16]. - The projected net profits for the company from 2025 to 2027 are estimated to be 112 million CNY, 153 million CNY, and 206 million CNY respectively, with corresponding EPS of 0.16 CNY, 0.21 CNY, and 0.28 CNY [16][19]. Financial Summary - Total revenue is projected to decline from 1,600 million CNY in 2023 to 741 million CNY in 2024, followed by a gradual increase to 1,326 million CNY by 2027 [4][13]. - The net profit attributable to the parent company is expected to show significant growth from 130 million CNY in 2023 to 206 million CNY in 2027, reflecting a substantial increase in profitability [4][13]. - The company’s return on equity (ROE) is projected to rise from 4.2% in 2023 to 6.3% in 2027, indicating improved financial performance [4][13]. Demand Analysis - The company reported a 20.20% year-on-year increase in tourism revenue to 286 million CNY in the first half of 2025, driven by a rise in visitor numbers and product price adjustments [22][23]. - The number of tourists served by the cruise products reached 1.2525 million, marking a 10.96% increase compared to the previous year, indicating a strong recovery in demand [22][23]. Supply Analysis - The regulatory environment has tightened, with new restrictions on the establishment of inter-provincial passenger transport companies, which is expected to stabilize the competitive landscape [26][28]. - The company plans to build and operate four large leisure cruise ships, with the first two expected to be operational by June and December 2026, respectively [29][30].