Guotai Junan Securities·2024-05-23 05:02Investment Rating - The report maintains a "Buy" rating for Ctrip Group [2][3]. Core Views - The company exceeded expectations in Q1 2024, benefiting from improvements in the OTA industry landscape and strong growth in outbound and overseas travel, with profit margins still on an upward trajectory [2]. - Adjusted net profit estimates for 2024, 2025, and 2026 have been raised to RMB 14.299 billion, RMB 17.075 billion, and RMB 19.580 billion, reflecting increases of +14.16%, +16.92%, and +19.40% respectively [2]. - The target market capitalization has been adjusted to RMB 328.9 billion, corresponding to a target price of HKD 528 based on a 23x PE valuation for 2024 [2]. Financial Summary - Q1 2024 revenue reached RMB 11.92 billion, representing a year-on-year increase of +29.42%, while net profit attributable to shareholders was RMB 4.312 billion, up +27.76% [2]. - Adjusted net profit for Q1 2024 was RMB 4.055 billion, showing a significant increase of +96.37%, and adjusted EBITDA was RMB 3.974 billion, up +40.92% with an EBITDA margin of 33.3%, an increase of 2.7 percentage points [2]. - The revenue growth slightly exceeded guidance (+29.42% vs. expected 24-29%), while adjusted EBITDA significantly surpassed expectations (RMB 3.974 billion vs. expected RMB 3.2-3.4 billion) [2]. Market Position and Growth Drivers - The company demonstrated strong performance in group travel, with a growth rate of +129%, driven primarily by outbound travel demand, as international flights have recovered to 70% of pre-pandemic levels [2]. - Ctrip's overseas segment, Trip.com, experienced rapid growth, with a revenue increase of 80% in Q1 2024, contributing to 10% of total revenue [2]. - The report highlights Ctrip's brand strength and product supply advantages, particularly in high-tier cities, where travel consumption remains resilient despite concerns over growth rates from a high base [2].