Core Viewpoint - Cathay Pacific Group reported significant increases in passenger and cargo traffic for August, indicating a strong recovery in travel demand and operational performance [1] Passenger Traffic - Cathay Pacific's passenger volume in August increased by 30% year-on-year, with available seat kilometers rising by 32% [1] - The average daily passenger count exceeded 110,000, reflecting robust leisure travel demand, particularly for short-haul destinations from Hong Kong and mainland China [1] - Hong Kong Express also saw a 36% increase in passenger numbers and a 41% rise in available seat kilometers year-on-year [1] Cargo Traffic - The cargo volume for Cathay Pacific increased by 13% year-on-year, with available cargo ton kilometers up by 15% [1] - Demand for cargo to the Americas remained strong, contributing to the healthy growth in cargo traffic [1] - To meet the growing demand, the company plans to increase cargo capacity, including launching a new weekly cargo route to Madrid starting October 13, 2025 [1] Future Outlook - Despite September being a traditionally quieter travel month, the upcoming National Day and Mid-Autumn Festival are expected to boost travel demand [1] - The positive growth momentum in both passenger and cargo segments is anticipated to continue into September [1]

Group 1 - The summer season has seen a significant increase in foreign tourists in popular destinations like Xiamen and Shanghai, driven by visa facilitation and increased flight availability, particularly in the cruise market [1] - As of August 30, the total number of inbound and outbound travelers at Xiamen port exceeded 1 million since the start of the summer travel season on July 1, marking a year-on-year increase of over 15% [3] - Xiamen's cruise market is set to launch its 2025 autumn and winter season, with 18 homeport cruise voyages and 6 port-of-call cruises planned, marking the first complete season since the new international cruise terminal opened [5] Group 2 - Shanghai's cruise market experienced a record summer, with over 10,000 passengers aboard the "Aida·Magic City" and "Mediterranean Glory" cruises returning to Shanghai on August 30, surpassing the total number of travelers for the entire previous year [7] - As of August 26, the number of inbound and outbound travelers at Shanghai's cruise port reached 1.377 million, a year-on-year increase of 48.71%, with nearly 85,000 foreign cruise travelers, exceeding last year's total of approximately 69,000 [9] - The upcoming months of September and October are expected to see a continued high volume of cruise departures from Shanghai [11]

Group 1 - The summer travel peak has led to a significant increase in inbound and outbound passenger flow at major ports in China, primarily driven by study tours and family trips [1][3] - As of July 16, 2025, Beijing Daxing International Airport has recorded over 3 million inbound and outbound passengers this year, a 30.4% increase compared to the same period last year, achieving this milestone 46 days earlier than the previous year [1] - Daily average passenger flow since July has maintained a high level of 17,600, an increase of over 1,700 compared to June [3] Group 2 - Shenzhen Luohu Port has experienced a surge in passenger flow, with over 297,000 travelers recorded on July 13, setting a new historical high since the resumption of border crossings [5] - The expected growth in passenger flow this summer compared to last year is supported by enhanced services, including policy consultation and travel guidance [7] - Liaoning has launched multiple cultural and tourism promotion activities, resulting in over 15,000 inbound foreign visitors since July 1, a 52% year-on-year increase, with visa-free entries growing sevenfold [9] Group 3 - Dalian Airport has increased charter flights to Ulaanbaatar, Mongolia, and enhanced routes to Vladivostok, Russia, while introducing multilingual self-service immigration card terminals to improve the travel experience [11]

Investment Rating - The report maintains an "Overweight" investment rating for the consumer services industry, anticipating that the industry index will outperform the market index by over 10% in the next six months [30]. Core Insights - The summer peak season is commencing, with the Ministry of Culture and Tourism organizing the 2025 National Summer Cultural and Tourism Consumption Season, which will feature over 43,000 cultural and tourism consumption activities and distribute over 570 million yuan in consumption subsidies [30][18]. - The consumer services sector index has risen by 2.24% from June 27 to July 10, 2025, outperforming the Shanghai and Shenzhen 300 index by approximately 0.62 percentage points [7][30]. - The report highlights a divergence in performance among sub-sectors, with the tourism sector recovering while the hotel and catering sector continues to decline [8][30]. Summary by Sections Market Review - The consumer services industry index increased by 2.24%, ranking sixteenth among all CITIC first-level industry indices, and outperformed the Shanghai and Shenzhen 300 index by about 0.62 percentage points [7]. - Sub-sector performance varied, with the comprehensive service, tourism, hotel catering, and education sectors showing respective changes of 5.66%, 0.51%, -0.65%, and 5.91% [8]. - A total of 35 listed companies in the industry reported positive returns, with the top five performers being Dou Shen Education, Fang Zhi Technology, Caesar Travel, Miao Exhibition, and Bo Rui Communication, with increases of 15.75%, 12.43%, 12.31%, 10.35%, and 8.11% respectively [10]. - The overall PE (TTM) for the consumer services industry is approximately 31.12 times, slightly up from the previous period but still below the average valuation of 49.30 times since 2016 [14]. Industry News - The Ministry of Culture and Tourism will host over 43,000 cultural and tourism consumption activities during the summer season, with various promotional measures including consumption vouchers and discounts [18]. - The Sichuan government is supporting qualified cultural and tourism enterprises to go public, aiming to strengthen key tourism businesses [19]. - The Ministry will intensify monitoring of package tourism products related to family travel, study tours, and summer vacation, focusing on illegal practices [20][22]. Company Announcements - Notable companies to watch include Jin Jiang Hotel, Changbai Mountain, Emei Mountain A, Xiangyuan Cultural Tourism, Tianmu Lake, Jiuhua Tourism, Zhongxin Tourism, and Songcheng Performing Arts, with recommendations based on their potential benefits from the summer peak season [30][31].

Investment Rating - The report maintains a "Market Perform" investment rating for the consumer services industry, indicating that the industry index is expected to perform within ±10% of the market index over the next six months [34]. Core Insights - The consumer services industry index rose by 2.02% from May 30, 2025, to June 12, 2025, outperforming the Shanghai and Shenzhen 300 index by approximately 1.15 percentage points [9]. - The report highlights that domestic travel during the Dragon Boat Festival saw 119 million trips, a year-on-year increase of 5.7%, with total spending reaching 42.73 billion yuan, up 5.9% year-on-year [22]. - The upcoming summer travel season is expected to reverse the subdued performance observed during the Dragon Boat Festival, with a projected 70% increase in summer travel numbers and an 80% increase in gross merchandise value (GMV) compared to the previous year [34]. Summary by Sections Market Review - The consumer services industry index outperformed the Shanghai and Shenzhen 300 index, with a rise of 2.02% during the reporting period [9]. - The tourism and education sectors showed recovery, while the hotel and comprehensive services sectors experienced declines [10]. - A total of 38 listed companies in the industry reported positive returns, with the top five performers being ST United, Qujiang Cultural Tourism, Jinling Hotel, Changbai Mountain, and Tianmu Lake, with increases ranging from 11.86% to 55.13% [14]. - The overall price-to-earnings (PE) ratio for the consumer services industry was approximately 30.92 times, reflecting an increase compared to previous periods [18]. Industry News - The report notes significant trends in the tourism market, including a focus on family-oriented travel and deep experiential offerings, as highlighted in the 2025 Summer Travel Trend Report by Zhongxin Tourism [24]. - The popularity of the Jiangsu Super League has led to a surge in tourism bookings in Jiangsu, with an increase of over 300% in reservations [26]. - Haichang Ocean Park announced plans to introduce Xiangyuan Holdings as a new controlling shareholder [27]. Company Announcements - The report suggests monitoring specific companies such as Jinjiang Hotel, Changbai Mountain, Emei Mountain A, Xiangyuan Cultural Tourism, Jiuhua Tourism, Zhongxin Tourism, and Songcheng Performing Arts for potential investment opportunities due to their favorable positioning in the upcoming summer season [35].