东方证券指出，海南离岛免税景气回升。11月1–7日海南离岛免税购物金额5.06亿元、购物人数7.29万人 次，同比分别+34.86%、+3.37%，该行判断是受益于低基数、离岛免税新政、演唱会等大型活动、叠加 渠道促销所致。此外，日本游被"劝退"有望推动部分境外购物需求回流、叠加今年以来股市财富效应抬 升，冬季海南游和海南的免税销售有望受益。 消息面上，海南自由贸易港将于今年12月18日正式启动全岛封关运作。中国中免表示，现行离岛免税的 45 大类商品均已被列入《海南自由贸易港进口征税商品目录》。因此，封关后一定时期内，海南离岛 免税的整个体系将仍按目前情况运行，而旅客和商旅出行人次则有望随自贸港建设而持续增长，免税行 业占比较高的消费者服务有望受益。 智通财经APP获悉，中国中免(01880)早盘涨超4%，截至发稿，涨4.81%，报76.3港元，成交额1.48亿港 元。 ...

Core Viewpoint - UBS reports that Hainan's duty-free sales reached 5.06 billion RMB from November 1 to 7, representing a 35% year-on-year increase, significantly exceeding market expectations, driven by new duty-free shopping policies [1] Industry Summary - The optimistic outlook for China's duty-free industry is primarily due to new policies in Hainan and a low base effect, with expectations for a positive sales trend in Q4 and accelerated growth from 2026 to 2027 [1] - China Duty Free Group (01880) is anticipated to be the biggest beneficiary of the favorable conditions in the duty-free market [1] - The expansion of airport duty-free areas and a double-digit growth in international passenger traffic are expected to contribute to a steady recovery in airport duty-free sales [1] - Policy relaxation, along with increased retail space and product variety, will act as catalysts for growth in China's duty-free sales [1]

Investment Rating - The industry investment rating is "Accumulate" [5] Core Viewpoints - The duty-free industry is experiencing a positive turnaround in fundamentals, with high-frequency data for Hainan's offshore duty-free sales showing improvement in Q3 2025, and a stable outlook for Q4 2025 [1][3] - Recent policy implementations have clarified the direction for the Hainan Free Trade Port, with significant announcements made regarding the closure date and adjustments to duty-free policies [2][3] - The operational performance of duty-free businesses is expected to improve, with notable increases in shopping amounts and visitor numbers following the implementation of new policies [3] Summary by Sections Industry Performance - In Q3 2025, Hainan's offshore duty-free sales totaled 5.402 billion yuan, a year-on-year decrease of 2.7%, with shopping visits at 946,800, down 23.4% year-on-year. The average transaction value increased by 27.1% to 5,705.53 yuan [1] - September 2025 saw duty-free sales of 1.733 billion yuan, a year-on-year increase of 3.4%, with shopping visits at 280,000, down 7.3%, and an average transaction value of 6,189.29 yuan, up 22.0% [1] Policy Developments - On July 23, 2025, the State Council announced the closure date for the Hainan Free Trade Port as December 18, 2025, providing detailed policies that reflect a clear direction for the port [2] - On October 17, 2025, three departments released adjustments to the offshore duty-free policy, expanding the categories of duty-free goods and allowing more purchasing opportunities for travelers [2] Business Expectations - China Duty Free Group reported Q3 2025 revenue of 11.711 billion yuan, a year-on-year decrease of 0.38%, with net profit down 28.94% to 452 million yuan. However, there were improvements in revenue growth and gross margin on a quarter-on-quarter basis [3] - Following the implementation of the new duty-free policy on November 1, 2025, shopping amounts reached 78.549 million yuan, with significant increases in both the number of purchases and visitors compared to the previous day [3]

Investment Rating - Investment advice: Following the new offshore duty-free policy in Hainan Island, further policy support optimizes in-city duty-free pickup, opening growth potential [5][6][7]. Core Views - The recent notice issued by multiple Chinese ministries aims to enhance the role of duty-free policies in boosting consumption, guiding overseas consumption back, attracting foreign consumers, and promoting healthy development of duty-free retail [6][7]. - The notice improves duty-free policies in four areas: optimizing domestic product tax refund policies, expanding duty-free categories, relaxing duty-free store approval, and enhancing convenience and regulation [7][8]. - The optimization of in-city duty-free pickup is expected to significantly enhance shopping convenience and expand the market size for in-city duty-free stores [8]. Summary by Sections Policy Improvements - The notice allows for the sale of more domestic products in duty-free stores and encourages the inclusion of products reflecting Chinese culture [7]. - New categories for duty-free sales include popular items such as cellphones, drones, sports goods, health foods, OTC drugs, and pet food [7]. - Approval processes for duty-free stores are being relaxed to allow local optimization of store layouts [7]. Market Potential - The new policy allows travelers to pick up duty-free goods at port entry stores after making reservations at in-city stores, which is expected to enhance consumer experience and expand the market [8]. - The opening of in-city duty-free stores in major cities like Shenzhen and Guangzhou is anticipated to contribute positively to performance growth [8].

Investment Rating - The investment rating for China Duty Free Group (601888) is maintained as "Buy" [6]. Core Insights - The report indicates that the sales in Hainan's duty-free market are stabilizing and recovering, with policy benefits optimizing the business environment [6]. - Despite short-term profit pressures, the core business in Hainan shows signs of recovery, with monthly sales returning to positive growth and market share increasing [6]. - The company is expanding its duty-free store layout, adopting a dual-track operation model of "duty-free + taxable" in new city stores, which is expected to drive growth [6]. Financial Data and Earnings Forecast - For 2025, the total revenue is projected to be 55,146 million yuan, with a year-on-year decline of 2.4% [5]. - The net profit attributable to the parent company is expected to be 4,002 million yuan in 2025, reflecting a year-on-year decrease of 6.2% [5]. - The earnings per share (EPS) for 2025 is estimated at 1.93 yuan, with a projected return on equity (ROE) of 6.9% [5]. - The company plans to distribute a mid-term cash dividend amounting to 5.17 million yuan, which is 16.95% of the net profit for the first three quarters [6]. Market Performance - The closing price of the stock is 76.67 yuan, with a market capitalization of 149,696 million yuan [1]. - The stock has a price-to-book ratio of 2.8 and a dividend yield of 1.37% [1]. - The stock's performance over the past year has seen a high of 78.51 yuan and a low of 54.75 yuan [1].

Investment Rating - The report assigns a "Trading Buy" rating for the company, indicating a potential upside of 5% to 15% from the current price [6][9]. Core Insights - The company reported a revenue of RMB 39.86 billion for the first three quarters of 2025, a year-on-year decline of 7.3%, with a net profit attributable to shareholders of RMB 3.05 billion, down 22% year-on-year [7][9]. - The third quarter saw revenue of RMB 11.7 billion, remaining flat year-on-year, but the net profit dropped by 29% to RMB 450 million, falling short of expectations [7][9]. - The company announced a cash dividend of RMB 0.25 per share [7]. Summary by Sections Company Overview - The company operates in the leisure services industry, with an A-share price of RMB 76.07 as of October 31, 2025, and a market capitalization of RMB 148.53 billion [2]. Recent Ratings - The company has seen various ratings over the past year, including "Buy" and "Trading Buy," with the most recent rating being "Trading Buy" on January 17, 2025 [3][6]. Financial Performance - The gross profit margin for the first three quarters decreased by 0.58 percentage points to 32.54%, while the third quarter margin remained stable at 32% [9]. - The company expects revenue to recover in the fourth quarter, driven by increased sales during the National Day and Mid-Autumn Festival, with daily sales in Hainan reaching RMB 940 million, a 5% year-on-year increase [9]. Future Projections - The report revises profit forecasts downward, expecting net profits of RMB 3.72 billion, RMB 3.89 billion, and RMB 4.27 billion for 2025, 2026, and 2027 respectively, with corresponding EPS of RMB 1.80, RMB 1.88, and RMB 2.06 [9][11].

Core Viewpoint - The recent notification from the Ministry of Finance and other departments aims to enhance the duty-free shop policy to boost consumption, effective from November 1, 2025, focusing on optimizing tax policies, expanding product categories, decentralizing approval powers, and improving shopping experiences [1][2]. Group 1: Policy Enhancements - The policy supports domestic products in duty-free shops, treating them as exports for tax purposes, with at least 25% of the sales area in duty-free shops dedicated to domestic goods [2]. - New product categories include mobile phones, micro-drones, and over-the-counter drugs, aligning with consumer demand [2]. - Approval powers for establishing duty-free shops are delegated to provincial departments, allowing for tailored local development [2]. - The introduction of online booking and pick-up services enhances the shopping experience for consumers [2]. Group 2: Impact on Consumption - The number of travelers utilizing the duty-free tax refund service has increased significantly, with a 229.8% year-on-year rise in the number of travelers and a 97.4% increase in tax refund amounts from January to September this year [3]. - The expanded product offerings and support for domestic goods are expected to stimulate both domestic and inbound consumer spending, encouraging overseas consumption to return [3]. - Decentralizing approval and optimizing layouts will foster local engagement, creating unique shopping experiences that can drive growth in related sectors such as tourism and dining [3]. - The policy is anticipated to lower operational costs for domestic products, enhancing their market presence while attracting international brands to invest [3].

Investment Rating - The investment rating for the company is "Buy" [7][8] Core Views - The report highlights that the company's revenue for Q3 was 11.711 billion RMB, showing a year-over-year decline of 0.38%, while the net profit attributable to the parent company was 0.452 billion RMB, down 28.9% year-over-year [1] - The company plans to initiate a mid-term dividend, with a total dividend of 0.517 billion RMB for the first nine months of 2025, accounting for 16.95% of the net profit [1] - The report indicates that demand is stabilizing, supported by various stimulus policies in Hainan, leading to a marginal recovery in duty-free sales [1][2] - The company is accelerating its strategic transformation and expanding its boundaries to stimulate demand, with the establishment of city duty-free stores progressing steadily [3][4] Summary by Sections Financial Performance - For Q1-Q3, the company's total revenue was 39.862 billion RMB, a year-over-year decrease of 7.3%, and the net profit attributable to the parent company was 3.052 billion RMB, down 22.1% year-over-year [1] - The gross profit margin for Q3 was 32.0%, remaining stable year-over-year, with sales and management expense ratios at 18.7% and 3.9%, respectively [3] Market Trends - The duty-free sales in Hainan for Q3 2025 reached 5.403 billion RMB, a year-over-year decline of 2.6%, but showed signs of improvement with a positive year-over-year growth of 3.4% in September [2] - The average spending per person increased by 13.6% year-over-year to 5,707 RMB, indicating a significant improvement in consumer spending [2] Strategic Developments - The company opened three city duty-free stores in Shenzhen, Guangzhou, and Chengdu in Q3 2025, with plans for a store in Tianjin by the end of the year [4] - The report emphasizes the potential long-term benefits from the upcoming closure of Hainan's free trade port, expected to attract international brands and enhance the integration of culture, tourism, and shopping [3] Profit Forecast and Valuation - The net profit forecasts for 2025-2027 have been revised down by approximately 21.94%, 20.48%, and 20.53%, respectively, with expected net profits of 3.658 billion RMB, 4.209 billion RMB, and 4.788 billion RMB [5] - The target price for A-shares has been adjusted to 81.20 RMB and for H-shares to 75.84 HKD, reflecting a premium valuation based on comparable companies [5]

Core Insights - The company reported a total revenue of 39.862 billion yuan for Q3 2025, a decrease of 3.158 billion yuan compared to the same period last year, representing a year-on-year decline of 7.34% [1] - The net profit attributable to shareholders was 3.052 billion yuan, down by 0.867 billion yuan from the same period last year, reflecting a year-on-year decrease of 22.13% [1] - The net cash inflow from operating activities was 3.388 billion yuan, which is a reduction of 1.716 billion yuan compared to the same period last year, marking a year-on-year decline of 33.62% [1] Financial Ratios - The latest debt-to-asset ratio stands at 18.34%, a decrease of 0.27 percentage points from the previous quarter and a reduction of 2.34 percentage points from the same period last year [3] - The gross profit margin is reported at 32.54%, down by 0.22 percentage points from the previous quarter and down by 0.58 percentage points year-on-year [3] - The return on equity (ROE) is 5.48%, which is a decrease of 1.75 percentage points compared to the same period last year [3] Earnings and Turnover - The diluted earnings per share (EPS) is 1.48 yuan, a decrease of 0.42 yuan from the same period last year, reflecting a year-on-year decline of 22.13% [4] - The total asset turnover ratio is 0.53 times, down by 0.03 times compared to the same period last year, representing a year-on-year decline of 5.71% [4] - The inventory turnover ratio is 1.56 times, which is an increase of 0.11 times year-on-year, marking a 3-year consecutive increase with a year-on-year rise of 7.45% [4] Shareholder Structure - The number of shareholders is reported at 309,300, with the top ten shareholders holding a total of 1.36 billion shares, accounting for 65.74% of the total share capital [4] - The largest shareholder is China Tourism Group Co., Ltd., holding 50.30% of the shares [4]

Group 1: Duty-Free Shopping in Hainan - The duty-free shopping experience in Hainan has become increasingly popular among young consumers, allowing them to enjoy low-priced goods without traveling abroad [1] - The duty-free industry is emerging as a significant highlight of Hainan's economy, driven by various promotional activities and favorable policies [1] - By the end of 2025, Hainan will implement a full island closure, marking a crucial step in establishing a free trade port, which is expected to enhance trade and investment policies across a broader scope [1] Group 2: Hainan's Economic Development - Hainan's development has far-reaching implications not only for China but also for other Asian countries and the global economy [3] - The dialogue between Hainan's provincial secretary Feng Fei and Singapore's Prime Minister Lee Hsien Loong highlights the close cooperation between Hainan and Singapore, particularly in tourism and maritime industries [5] - Feng Fei's leadership and background in engineering and management are seen as instrumental in driving Hainan's rapid development and attracting necessary technologies and projects [5][6] Group 3: Leadership and Future Prospects - Feng Fei's educational background, including his studies at prestigious institutions like Tianjin University and Tsinghua University, has equipped him with the skills necessary for effective governance [6][7] - Since joining the government, Feng Fei has rapidly advanced through the ranks, demonstrating strong academic and professional capabilities [7] - As the new provincial secretary of Hainan, Feng Fei is tasked with promoting rapid development in key industries and accelerating state-owned enterprise reforms, positioning Hainan as a vibrant economic region in the future [8]