Group 1 - The core viewpoint of the article is that Tongcheng Travel's Q1 adjusted net profit increased by 41% year-on-year, exceeding expectations, indicating effective company strategies despite challenges [1] - The report highlights that the company's focus on lower-tier city users has allowed it to outperform peers in the short term [1] - The company continues to emphasize further monetization and improving the return on investment for its sales and marketing efforts, which is expected to support its profit margins [1] Group 2 - The report expresses increased confidence in Tongcheng Travel achieving a 20% year-on-year growth in net profit for the year, even without accounting for the planned acquisition of Wanda Hotel Management [1] - The target price for Tongcheng Travel has been slightly raised from HKD 23.3 to HKD 23.6, maintaining a buy rating [1]

Investment Rating - The report maintains a "Buy" rating for the company [6]. Core Insights - The company reported a revenue of 4.377 billion yuan in Q1 2025, representing a year-on-year increase of 13.2%, and an adjusted net profit of 788 million yuan, up 41.1% year-on-year [1]. - The core OTA revenue reached 3.792 billion yuan in Q1 2025, with a year-on-year growth of 18.4%, driven by strong performance in international accommodation and ticketing [2]. - The gross margin for Q1 2025 was 68.8%, an increase of 3.8 percentage points year-on-year, benefiting from scale effects due to revenue growth [3]. - The adjusted net profit margin reached 18.0%, up 3.6 percentage points year-on-year, while the core OTA profit margin was 29.2%, reflecting a year-on-year increase of 6.6 percentage points [3]. - The company announced an agreement to acquire 100% of Wanda Hotel Management (Hong Kong) Co., Ltd., which is expected to enhance its high-end hotel management capabilities [3]. Revenue and Profit Forecast - The company is projected to achieve adjusted net profits of 3.393 billion yuan, 4.060 billion yuan, and 4.647 billion yuan for the years 2025, 2026, and 2027, respectively [4]. - The current stock price corresponds to adjusted P/E ratios of 13, 11, and 10 for the years 2025 to 2027 [4].

Investment Rating - The report maintains a "Buy" rating for the company [1][9]. Core Insights - The company has shown continuous improvement in profit margins, with a focus on international expansion performance [3][6]. - In Q1 2025, the company achieved revenue of 4.4 billion yuan, representing a year-over-year increase of 13%, and an adjusted net profit of 790 million yuan, up 41% year-over-year, with an adjusted net profit margin of 18%, an increase of 3.6 percentage points year-over-year [5][6]. Financial Performance - The core online travel platform generated revenue of 3.8 billion yuan in Q1 2025, a year-over-year increase of 18%, with an operating profit margin of 29.2%, up 6.6 percentage points year-over-year [6]. - Revenue from transportation ticketing reached 2 billion yuan, up 15% year-over-year, benefiting from increased demand and enhanced value-added services [6]. - Accommodation bookings generated 1.2 billion yuan in revenue, a 23% year-over-year increase, with international hotel night volume growing over 50% [6]. - The vacation business faced short-term revenue pressure, generating 590 million yuan, down 11.8% year-over-year, due to safety issues in Southeast Asia [6]. User Metrics - The average monthly paying user count reached 46.5 million, a 9.2% year-over-year increase, with annual paying users totaling 247 million, up 7.8% year-over-year [6]. - Over 87% of registered users reside in non-first-tier cities in China, with 68% of new paying users from these areas, reinforcing the platform's position in the mass market [6]. Future Projections - Revenue forecasts for 2025-2027 are adjusted to 19.3 billion, 22.1 billion, and 24.9 billion yuan respectively, with net profits projected at 2.7 billion, 3.0 billion, and 3.5 billion yuan [8]. - The target market capitalization for 2025 is set at 51.4 billion yuan, with a target price of 24 HKD per share [8].

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].

Group 1: Company Overview - The report highlights that Tongcheng Travel's Q1 profits exceeded expectations by 8%, attributed to a cautious subsidy and investment strategy, with OTA business profit margins increasing by 7 percentage points year-on-year [1] - The expected revenue growth for the OTA segment in Q2 is projected at 14% year-on-year, with profit margins continuing to show an upward trend [1] - Domestic hotel night stays are expected to see a high single-digit growth year-on-year, with Average Daily Rate (ADR) turning positive and reduced subsidy rates driving revenue growth [1] Group 2: Financial Projections - The report has slightly adjusted its forecasts while maintaining a target price of HKD 25.50, indicating a potential upside of 24.4% from the current closing price of HKD 20.50 [1] - The main drivers for revenue growth in the second half of the year are anticipated to be the increase in night stays and ADR [1] - The vacation business has seen a decline in revenue due to strategic adjustments, but this has had a minimal impact on overall profits [1]

Group 1 - The core viewpoint of the article highlights that Tongcheng Travel's stock has risen over 10% following its financial results for the first quarter [1] - In the first quarter, Tongcheng Travel achieved revenue of approximately 4.377 billion yuan, representing a year-on-year growth of 13.2% [1] - The adjusted net profit for the same period was about 788 million yuan, showing a significant year-on-year increase of 41.1% [1]

Core Viewpoint - Tongcheng Travel's performance is steadily growing driven by the release of public travel demand, AI technology revolution, and global expansion [1][4] Financial Performance - In Q1 2025, Tongcheng Travel achieved revenue of 4.377 billion yuan, a year-on-year increase of 13.2%; adjusted EBITDA reached 1.159 billion yuan, up 41.3% [2][3] - The company reported a 40% year-on-year increase in international ticket sales and a 50% increase in international hotel night stays [2] Business Segments - The three core business segments of transportation, accommodation, and vacation all experienced double-digit growth in Q1 2025, with transportation revenue increasing by 15.2% to 2 billion yuan, accommodation revenue rising by 23.3% to 1.19 billion yuan, and vacation revenue growing by 20% to 603 million yuan [1][2] - The annual service user count reached 1.96 billion, with annual paying users hitting a record high of 247 million [2] AI Integration - Tongcheng Travel has advanced its AI capabilities, achieving a 43% improvement in efficiency and an 80% increase in booking efficiency through the integration of "Chengxin AI" and DeepSeek [3] - The AI system can generate personalized travel plans based on user input, enhancing user experience and operational efficiency [3] Market Outlook - The CEO of Tongcheng Travel expressed optimism about the growing travel market, particularly among non-first-tier city consumers, and plans to continue focusing on the mass travel market while enhancing AI capabilities [4]

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 per share, with a P/E ratio of 32.27 times [1]

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]

Investment Rating - The report maintains a "Strong Buy" rating for the company [1][4]. Core Views - The company achieved a revenue of 4.38 billion yuan in Q1 2025, representing a year-on-year growth of 13.2%. Adjusted EBITDA and net profit were 1.16 billion yuan and 790 million yuan, respectively, with year-on-year growth of 41.3% and 41.1% [1][7]. - Domestic travel demand remains robust, supported by improved commission rates and sustained leisure travel demand. The company's revenue is expected to continue its high growth trend, aided by the ongoing expansion of international business and cost optimization [1][7]. Financial Data and Valuation - Revenue projections for the upcoming years are as follows: 2023 at 11.9 billion yuan, 2024 at 17.3 billion yuan, 2025E at 19.3 billion yuan, 2026E at 21.9 billion yuan, and 2027E at 24.4 billion yuan, with growth rates of 81%, 46%, 11%, 13%, and 12% respectively [3][9]. - The adjusted net profit for 2025E is projected at 2.63 billion yuan, with a year-on-year growth of 33% [3][9]. - The company’s current price-to-earnings (PE) ratio based on non-GAAP earnings is 19.5 for 2023, decreasing to 10.0 by 2027 [3][10]. Business Performance - In Q1 2025, the company’s revenue from accommodation bookings, transportation tickets, vacation services, and other businesses were 1.19 billion yuan, 2.00 billion yuan, 590 million yuan, and 600 million yuan, reflecting year-on-year changes of +23.3%, +15.2%, -11.8%, and +20.0% respectively [7]. - The company’s average monthly paying users increased by 9.2% year-on-year to 46.5 million, with annual paying users reaching 250 million, a 7.8% increase [7]. Cost Management and Profitability - The gross margin for Q1 2025 was 68.8%, an increase of 3.8 percentage points year-on-year. The adjusted net profit margin was 18.0%, up 3.6 percentage points from the previous year [7]. - The company has effectively reduced costs and improved efficiency, leading to a notable enhancement in profitability [7].