Investment Rating - The report maintains a "Buy" rating for the company, with a target price of HK$24.00, representing a potential upside of 17.1% from the current price of HK$20.50 [5]. Core Insights - The company reported a strong performance in Q1 2025, with total revenue of RMB 4.4 billion, a year-on-year increase of 13%, exceeding both the report's and Bloomberg's expectations by 0.7% and 0.9% respectively. Adjusted net profit reached RMB 788 million, up 41% year-on-year, also surpassing forecasts [1][2]. - The core OTA business revenue was RMB 3.8 billion, accounting for 86.6% of total revenue, with a year-on-year growth of 18.4%, driven by strong performance in transportation ticketing and other services [2]. - The report anticipates stable growth in profits for the full year, with a projected 25% increase in operating profit and an 18% rise in non-GAAP net profit for the core OTA business in 2025 [1]. Summary by Sections Q1 2025 Performance - Total revenue was RMB 4.4 billion, a 13% increase year-on-year, with adjusted net profit at RMB 788 million, reflecting a 41% growth [1]. - The core OTA business saw revenue of RMB 3.8 billion, up 18.4% year-on-year, driven by growth in transportation ticketing and accommodation services [2]. Q2 2025 Outlook - For Q2 2025, total revenue is expected to reach RMB 4.7 billion, a 10% year-on-year increase, with core OTA revenue projected to grow by 13% [3]. - The report notes that while core OTA revenue growth may slow due to seasonal factors, a recovery is anticipated in the second half of the year [3]. Profitability and Margins - The overall operating margin improved to 18.7% in Q1 2025, up from 11.8% in Q1 2024, with the core OTA business margin expanding to 29.2% [4]. - The report predicts continued expansion of the core OTA's non-GAAP operating margin to 25.5% in Q2 2025, supported by healthy revenue growth and optimized sales and marketing expenses [4]. Financial Projections - Revenue projections for 2025-2027 have been slightly adjusted downwards by 2%, while non-GAAP net profit expectations remain largely unchanged [1][12]. - The company is expected to achieve total revenues of RMB 19.5 billion in 2025, with a year-on-year growth rate of 12.4% [10].

Investment Rating - The investment rating for the company is "Buy" (maintained) [1] Core Views - The company achieved a net operating revenue of 13.8 billion yuan in Q1 2025, representing a year-on-year growth of 16%, in line with Bloomberg consensus expectations. The adjusted EBITDA was 4.2 billion yuan, with an EBITDA margin of 30%. The Non-GAAP net profit was 4.2 billion yuan, showing a year-on-year increase of 3%, which is better than Bloomberg consensus expectations [7] - The international business continues to grow significantly, with outbound travel maintaining stable growth. The cross-border flight capacity has recovered to 83% of pre-pandemic levels, and hotel and flight bookings for outbound travel have exceeded 120% of the same period in 2019, outperforming the market by 30%-40% [7] - Domestic tourism demand remains strong, with inbound tourism also experiencing robust growth. In Q1, the number of inbound travelers increased by 40% year-on-year, with 75% coming from visa-free regions. The company's platform saw a nearly 100% year-on-year increase in inbound bookings, with hotel bookings in major visa-free countries in the Asia-Pacific region surging over 240% [7] - The company continues to focus on enhancing its international business through better product experiences and customer service, with a sales expense ratio of approximately 21% in Q1, which is better than expected [7] - The profit forecast for 2025-2027 has been adjusted, with the adjusted net profit for 2025, 2026, and 2027 projected at 17.6 billion, 19.7 billion, and 22 billion yuan respectively, corresponding to P/E ratios of 18, 16, and 15 times [7] Financial Summary - Total revenue for 2023 is projected at 44.51 billion yuan, with a year-on-year growth of 122.12%. For 2024, revenue is expected to reach 53.29 billion yuan, reflecting a growth of 19.73% [1] - The company's net profit attributable to shareholders for 2023 is estimated at 9.92 billion yuan, with a staggering year-on-year growth of 606.91%. The forecast for 2024 is 17.07 billion yuan, indicating a growth of 72.08% [1] - The latest diluted EPS for 2023 is projected at 13.90 yuan, with a P/E ratio of 32.27 times [1]