Core Insights - The upcoming 8-day holiday period is expected to see a significant increase in travel demand, with an estimated 2.36 billion trips, averaging about 295 million trips per day, representing a 3.2% increase compared to the same period last year [1] Group 1: Travel Trends - Self-driving remains the primary mode of travel, with an expected 1.87 billion trips, accounting for approximately 80% of total travel. Peak traffic on highways may exceed 70 million vehicles per day, with around 14 million being new energy vehicles [2] - The first travel peak is anticipated on October 1, with daily passenger flow potentially exceeding 340 million, marking a historical peak. A second peak is expected on October 7 and 8, suggesting travelers should plan their trips to avoid congestion [3] Group 2: Long-Distance Travel - There will be a notable increase in medium to long-distance travel, particularly in key urban areas such as Beijing-Tianjin-Hebei, Yangtze River Delta, Guangdong-Hong Kong-Macau Greater Bay Area, and Chengdu-Chongqing. This surge in vehicle flow may lead to traffic congestion and accidents, necessitating cautious driving [4] Group 3: Tourism Outlook - Domestic tourism is projected to be strong, with popular cities like Shanghai, Chengdu, Beijing, Guangzhou, Xi'an, Hangzhou, Nanjing, and Chongqing expected to surpass last year's tourism levels. International travel to countries like Japan, South Korea, and Southeast Asia is also expected to rise significantly, aided by visa-free policies [5] Group 4: Freight Transport - Freight transport is expected to remain stable during the holiday, with daily truck flow estimated at 5.5 to 5.8 million vehicles, consistent with last year but down about 30% from regular days. The demand for essential goods such as energy, food, and minerals is expected to remain steady, with minimal fluctuations in rail, port, and air cargo transport [6]

Group 1 - The core viewpoint of the news is that Dexin Service Group is set to acquire a 95% and a 5% stake in Deqing Mogan Mountain Ruijun Real Estate Co., Ltd. for a total consideration of RMB 7.41 million and RMB 0.39 million respectively, with the acquisition expected to be completed by July 31, 2025 [1][2] - The target property is the Mogan Mountain Yungu Dexin Kaiyuan Hotel, located in Deqing County, Huzhou City, Zhejiang Province, China [1] - The acquisition is seen as a valuable opportunity for the group to invest in high-quality assets at favorable prices, which will enhance its commercial property management and diversify its services [2] Group 2 - The board believes that the acquisition will benefit the group's revenue sources in the long term and provide valuable experience in hotel management, expanding its business scope [2] - The property includes over 100 guest rooms, meeting facilities, restaurants, and bars, aligning with the growing trend of eco-tourism and domestic travel [2]

Core Viewpoint - Dexin Service Group (02215) announced a share transfer agreement to acquire 95% and 5% stakes in Deqing Mogan Mountain Ruijun Real Estate Co., Ltd. for a total consideration of RMB 74.1 million and RMB 3.9 million respectively, which will enhance the company's asset portfolio and financial performance [1] Group 1 - The acquisition involves the property known as Mogan Mountain Yungu Dexin Kaiyuan Hotel, located in Deqing County, Huzhou City, Zhejiang Province, China [1] - Upon completion of the acquisition in 2025, the target company will become a wholly-owned subsidiary, allowing its financial results to be consolidated into the company's financial statements [1] - The board believes that this acquisition provides a valuable opportunity to invest in high-quality assets at favorable prices, aligning with the growing trends in ecological tourism and domestic travel [1] Group 2 - The property includes over 100 guest rooms, meeting facilities, restaurants, and bars, which will enable the company to diversify its operations in commercial property management and conference services [1] - The board anticipates that the acquisition will positively impact the company's revenue sources in the long term and provide valuable experience in hotel management, thereby expanding its business scope [1]

Investment Rating - The report initiates coverage with a "Buy" rating for the company [4]. Core Views - The company is positioned as a leading player in the outbound group travel industry, with ongoing business recovery and an expanding layout [3][14]. - The domestic and outbound/inbound tourism industries are experiencing steady growth, with significant recovery following unconventional cycles [10][34]. - The company benefits from a robust supply chain, strong cash reserves, and a comprehensive online and offline channel strategy [3][10]. Summary by Sections Industry Overview - The outbound tourism penetration rate in China has been increasing, reaching 11.0% in 2019, but still lags behind developed countries like the US and South Korea [2]. - The outbound tourism market is characterized by a predominance of young, highly educated travelers who prefer personalized and customized experiences [2][10]. - The inbound tourism sector is supported by favorable policies and increased payment facilitation measures, enhancing the willingness of foreign tourists to visit China [1][10]. Company Positioning - The company operates in the midstream of the outbound tourism industry, primarily benefiting from industry growth and its leading market position [2][10]. - The company has maintained its core team and supply chain, enabling a swift recovery post-pandemic [3][10]. - The company has a strong brand value and resource integration capability, with plans to expand its retail business through a franchise model [3][10]. Financial Projections - Revenue is projected to grow significantly, with estimates of CNY 75.00 billion, CNY 87.35 billion, and CNY 103.39 billion for 2025, 2026, and 2027 respectively [3][8]. - The company is expected to achieve a net profit of CNY 1.16 billion, CNY 1.55 billion, and CNY 1.94 billion for the same years, reflecting a strong recovery trajectory [3][8]. - The projected P/E ratios for 2025, 2026, and 2027 are 67.2X, 50.4X, and 40.2X respectively, indicating a favorable valuation outlook [3][8].

Core Viewpoint - The company reported a strong performance in Q1 2025, with revenue and net profit exceeding market expectations, driven by controlled marketing expenses and favorable foreign exchange gains [1][3]. Performance Review - In Q1 2025, the company's revenue increased by 16% to 13.8 billion yuan, aligning with market expectations; non-GAAP net profit reached 4.2 billion yuan, exceeding market expectations by 9% [1]. - The company's hotel booking revenue in Q1 2025 was 5.54 billion yuan, a 23% year-on-year increase, surpassing market expectations by 1.4% [1]. Development Trends - Domestic tourism demand remains robust, with hotel prices expected to stabilize. The company anticipates a mid-to-low double-digit year-on-year growth in domestic hotel night stays for Q2 2025, with a narrowing decline in Average Daily Rate (ADR) [1]. - For outbound travel, the company expects a 15-20% year-on-year increase in outbound flight and hotel bookings in Q2 2025, recovering to 120% of 2019 levels, despite challenges in the Thai market [2]. Growth Expectations - Trip.com is projected to achieve high growth, with international OTA bookings increasing over 60% in Q1, and inbound travel bookings nearly doubling [3]. - The company expects to maintain a 50%+ revenue growth rate for Trip.com in the second half of the year, supported by strong demand from inbound tourism policies and brand expansion into new markets [3]. Profit Forecast and Valuation - The company has adjusted its non-GAAP net profit forecasts for 2025 and 2026 upwards by 3% to 16.4 billion yuan and 18.9 billion yuan, respectively, while maintaining revenue expectations [3]. - The target prices for the company's shares are set at $75.9 for US stocks and HK$588.5 for Hong Kong stocks, reflecting a potential upside of 13% and 14% from current prices [3].