Core Viewpoint - Jiangsu Shouxihu Cultural Tourism Co., Ltd. is preparing to enter the Hong Kong capital market, leveraging its unique waterway tourism operations in Yangzhou, which have shown significant revenue growth from RMB 0.31 billion in 2022 to RMB 1.11 billion in 2024, with net profit increasing from RMB 2.98 million to RMB 42.88 million [1][2] Company Overview - The company has a 20-year exclusive operating right for the Shugang-Shouxihu scenic area, expiring in 2035, and indefinite exclusive rights in the ancient canal area, which constitutes a significant competitive barrier [1][2] - The majority of the company's revenue, over 85%, comes from its waterway sightseeing services, which is expected to remain at 85.6% in the first half of 2025 [1] Business Risks - The company's revenue is highly concentrated in the Yangzhou area, making it vulnerable to regional economic fluctuations, adverse weather conditions, and local regulatory changes [2] - The expiration of the exclusive operating rights in 2035 poses a risk of increased renewal costs or changes in the operating model, which could significantly impact net profit margins [2] - The tourism industry is characterized by intense competition and rising customer service expectations, which could challenge profitability in the future [2] Business Structure - The core income source is from waterway sightseeing, with 206 boats in operation, including rowing boats and themed boats, and a maximum daily capacity of over 35,000 passengers during peak seasons [3] - The company has begun diversifying its revenue streams, with new services such as sightseeing bus operations contributing 11.6% of revenue in the first half of 2025, and a new immersive night tour project generating RMB 18.44 million, accounting for 21.8% of total revenue [3][4] Financial Considerations - The introduction of new services has increased fixed costs, with sales costs rising approximately 22% year-on-year in the first half of 2025 [4] - The company's light asset management service revenue is minimal, contributing only 5.1% of total revenue in 2024, with a significant drop in gross margin from 38.4% in 2023 to 16.4% in the first half of 2025 [4] Fundraising and Future Plans - The company plans to use the funds raised to develop more innovative immersive projects, upgrade facilities, and expand its light asset management services to create a nationwide waterway tourism management network [6] - The fundraising is seen as a critical step for the company to transition from a single scenic area operator to a comprehensive tourism service provider [6] Industry Landscape - The waterway tourism market in China is highly fragmented, with over 270 service providers and the top ten accounting for less than 30% market share [7] - Experts suggest that merely increasing assets and equipment will not significantly alter the competitive landscape; instead, strategic mergers and acquisitions of smaller operators are necessary for substantial market impact [7]

Core Viewpoint - Jiangsu Shouxihu Cultural Tourism Co., Ltd. is preparing for an IPO, primarily relying on its water-based sightseeing services, which account for over 85% of its revenue [1][2]. Group 1: Business Overview - The company is the only licensed water sightseeing operator in Yangzhou, holding exclusive rights for 20 years in the Shugang-Shouxihu scenic area and indefinite rights in the Grand Canal region [2]. - Revenue from water sightseeing services has significantly increased from 31 million yuan in 2022 to 111 million yuan in 2024, with net profit rising from 2.98 million yuan to 42.88 million yuan during the same period [2]. - The main business segments include water sightseeing services, sightseeing vehicle services, and scenic area management services, with water sightseeing consistently contributing over 85% of total revenue [2]. Group 2: Business Diversification Efforts - To reduce reliance on a single business, the company launched the "Grand Canal Yangzhou Journey" performance project in October 2024, generating 18.448 million yuan in revenue in the first half of 2025, accounting for 21.8% of total income [3]. - The company also introduced value-added services such as tea experiences and corporate custom events, which contributed 35.3% to total revenue in 2024 [3]. - The company holds a 16% market share in Jiangsu's water sightseeing ticket sales, ranking second in the province, but only 1% nationally, ranking tenth [3]. Group 3: Leadership and Historical Context - Xu Shunmei, the 55-year-old chairman, has been pivotal in the company's development, transitioning from a tour guide to management roles since 2011 [4]. - The company launched the "University Student Shouxihu Boat Girl" brand in 2009, focusing on a younger workforce for its rowing services [4]. - In 2017, the company successfully listed on the New Third Board, marking its first step towards capitalization, but faces challenges in achieving a successful IPO in the Hong Kong market due to low valuations for tourism companies [5][6].

Core Points - A sightseeing vehicle accident occurred at the Yuantuo Cape Tourist Resort in Qidong, Jiangsu, resulting in 4 fatalities due to a vehicle overturning and falling into the sea during strong winds [1][2] - The Jiangsu Golden Beach Tourism Culture Co., Ltd. violated wind-related operational suspension orders by operating the vehicle with 17 tourists onboard, leading to the incident [1] - The local authorities have detained the responsible individuals, and investigations into the cause and accountability of the accident are ongoing [1] Company Response - The Yuantuo Cape Tourist Resort has completed the initial aftermath management and expressed deep condolences to the victims' families, committing to enhance safety management and education to prevent future incidents [2]

Core Viewpoint - A tragic accident occurred at the Qidong Yuantuojiao Tourist Resort, resulting in the death of four individuals due to a sightseeing vehicle overturning in strong winds, highlighting safety compliance issues in the tourism industry [1]. Group 1 - The accident involved a sightseeing vehicle carrying 17 tourists that was operated despite a wind warning, indicating a violation of safety protocols by Jiangsu Golden Beach Tourism Culture Co., Ltd [1]. - Emergency services, including police and medical teams, responded promptly to the incident, showcasing the industry's emergency preparedness [1]. - The investigation into the accident is ongoing, with relevant personnel already detained by the police, emphasizing the accountability measures in place within the industry [1]. Group 2 - The aftermath of the incident has seen the completion of the necessary follow-up actions, indicating a swift response from the authorities and the company involved [2].

Core Points - A sightseeing vehicle in the Qidong Yuantuojiao Tourist Resort overturned and fell into the water due to strong winds, resulting in 4 fatalities [1] - The vehicle was carrying 17 tourists and was operated by Jiangsu Golden Beach Tourism Culture Co., Ltd., which violated a wind suspension notice [1] - The responsible individuals have been detained by the police, and investigations into the cause and accountability of the accident are ongoing [1] Company Summary - Jiangsu Golden Beach Tourism Culture Co., Ltd. disregarded safety protocols by operating the sightseeing vehicle during adverse weather conditions [1] - The company is currently facing legal scrutiny and potential repercussions due to the incident [1] Industry Summary - The incident highlights the importance of adherence to safety regulations in the tourism and leisure industry, particularly during extreme weather events [1] - Emergency response units, including police and medical services, were mobilized quickly to manage the situation and assist in rescue efforts [1]

Core Viewpoint - Jiangsu Shouxihu Cultural Tourism Co., Ltd. is preparing for an IPO, primarily relying on its water-based sightseeing services, which account for over 85% of its revenue [1][3]. Business Overview - The company has exclusive operating rights for water-based sightseeing in the Shugang-Shouxihu scenic area for 20 years and indefinite rights in the ancient canal area [3]. - Revenue from water-based sightseeing services has grown from 31 million RMB in 2022 to 111 million RMB in 2024, with net profit increasing from 2.98 million RMB to 42.88 million RMB during the same period [3]. - The main business segments include water-based sightseeing services, sightseeing vehicle services, and scenic area management services, with the latter two contributing a smaller portion of total revenue [3]. Revenue Breakdown - Water-based sightseeing services consistently represent over 85% of total revenue from 2022 to the first half of 2025, with specific percentages of 88.3%, 87.2%, 86.2%, and 85.6% respectively [3]. - The company introduced a new project, the Grand Canal Yangzhou performance cruise, which generated 18.44 million RMB in revenue in the first half of 2025, accounting for 21.8% of total revenue [3]. - Value-added services, such as tea experiences and corporate events, contributed 35.3% to total revenue in 2024 [3]. Market Position - In the Jiangsu province water-based sightseeing ticket sales market, the company holds a 16% market share, ranking second, but only 1% in the national market, placing it tenth [4][5]. Management and Leadership - The company is led by Xu Shunmei, who has a background as a tour guide and has been instrumental in developing the "Shouxihu Boat Girl" brand [7][10]. - Xu has emphasized the importance of training for the boat girls, ensuring they are skilled in various areas, including rowing and customer interaction [8]. Challenges and Future Outlook - The company previously listed on the New Third Board in 2017 but faces challenges in achieving a successful IPO in the Hong Kong market, where tourism companies have low valuations [10].

Core Viewpoint - Jiangsu Shouxihu Cultural Tourism Co., Ltd. (Shouxihu Wenlv) has submitted its prospectus to the Hong Kong Stock Exchange for an IPO, highlighting significant revenue and profit growth in the context of the ongoing cultural tourism boom [3][6][10]. Financial Performance - From 2022 to 2024, Shouxihu Wenlv's revenue is projected to grow from 31.236 million RMB to 111.428 million RMB, with a compound annual growth rate (CAGR) of 88.87%. Net profit is expected to increase from 3 million RMB to 43 million RMB, with a CAGR of 279.35% [6][9]. - In the first half of 2025, the company estimates revenue of 84.542 million RMB [9]. Business Segments - The company operates primarily in three segments: water sightseeing boat services, sightseeing vehicle services, and management services. The water sightseeing boat service is the core revenue driver, contributing approximately 88.3% to total revenue from 2022 to 2024 [8][10]. - In the first half of 2025, revenue from water sightseeing boat services accounted for 85.6% of total revenue [9]. Market Position - Shouxihu Wenlv is the only licensed water sightseeing operator in Yangzhou, holding a 20-year exclusive operating right in the Shugang-Shouxihu scenic area. It occupies the second position in Jiangsu's water sightseeing market, with a market share of 16% [10][9]. Unique Selling Proposition - The company leverages the unique cultural experience provided by its boatwomen, who not only row but also narrate stories and sing, enhancing the tourist experience [11][13]. - The company has diversified its offerings by introducing value-added services, such as educational tours and corporate events, which have seen revenue growth from 5.526 million RMB in 2022 to 39.297 million RMB in 2024 [20][17]. Future Prospects - Shouxihu Wenlv is expanding its operations beyond the Shouxihu area, launching a new project along the Grand Canal that combines sightseeing with cultural performances, aiming to enhance its market presence [22][23]. - The company is also exploring management service opportunities in other tourist areas, indicating a strategy to diversify its revenue streams [23][20]. Industry Context - The trend of scenic spots going public is not new, with companies like Zhangjiajie and Emei Mountain already listed. However, Shouxihu Wenlv's approach focuses on leveraging its unique scenic resources and related services to adapt to regulatory constraints [24][26]. - Despite the overall recovery in the cultural tourism sector, many listed tourism companies are still facing profitability challenges, highlighting the need for effective business strategies to convert tourism growth into financial success [29][30].

Core Viewpoint - Jiangsu Shouxihu Cultural Tourism Co., Ltd. (Shouxihu Wenlv) has submitted its prospectus to the Hong Kong Stock Exchange for an IPO, following its previous listing on the New Third Board in 2017. The company has shown significant revenue and profit growth, indicating a strong business performance in the cultural tourism sector [2][5]. Financial Performance - From 2022 to 2024, Shouxihu Wenlv's revenue increased from 31.236 million RMB to 111.428 million RMB, with a compound annual growth rate (CAGR) of 88.87%. During the same period, net profit rose from 3 million RMB to 43 million RMB, achieving a CAGR of 279.35% [5][6]. - The company's gross profit margin has shown a decline from 21.8% in 2022 to 54.4% in 2024, indicating a shift in cost structure and pricing strategy [6][8]. Business Segments - Shouxihu Wenlv operates primarily in three segments: water-based sightseeing services, sightseeing vehicle services, and management services. The water-based sightseeing services are the main revenue driver, contributing approximately 88.3% to total revenue in 2022, 87.2% in 2023, and 86.2% in 2024 [7][8]. - The company holds a 20-year exclusive operating right for water-based sightseeing in the Shugang-Shouxihu scenic area, making it the only licensed operator in the region [9]. Market Position - In 2024, Shouxihu Wenlv ranked second in Jiangsu Province's water-based sightseeing market, capturing 16% of the market share in ticket sales [8][9]. - The company is leveraging its unique cultural assets, such as the "Shouxihu boat women," to enhance the tourist experience and differentiate itself from competitors [10][11]. Growth Strategies - Shouxihu Wenlv is diversifying its offerings beyond traditional boat services by introducing value-added services, such as educational tours and corporate events, which have seen revenue growth from 5.526 million RMB in 2022 to 39.297 million RMB in 2024 [25][28]. - The company has also launched a new project, the Grand Canal Yangzhou Journey, which combines boat tours with cultural performances, aiming to expand its market reach beyond Shouxihu [28][27]. Industry Context - The cultural tourism sector is experiencing a resurgence, with several companies attempting to go public. However, many are still struggling with profitability despite increased revenue [39][40]. - Shouxihu Wenlv's IPO attempt reflects a broader trend in the industry, where companies are seeking to capitalize on the growing interest in cultural and heritage tourism [30][36].

Core Insights - The tourism consumption in China is projected to reach 5.8 trillion yuan in 2024, with expectations to exceed 10 trillion yuan by 2029, reflecting a compound annual growth rate (CAGR) of 12% from 2024 to 2029 [1] Company Overview - Jiangsu Shouxihu Cultural Tourism Co., Ltd. (referred to as "Shouxihu") has submitted an IPO application to the Hong Kong Stock Exchange, with Everbright Securities International as the sole sponsor [2] - Shouxihu operates water sightseeing services primarily in the famous scenic area of Shouxihu in Yangzhou, which is distinct from Hangzhou's West Lake [2][3] Revenue Sources - Over 80% of Shouxihu's revenue comes from water sightseeing services, with the signature rowing boat being a key offering [3] - The company provides various types of watercraft services, including rowing boats, self-driving boats, and themed boats, with rowing boats being the most popular among tourists [4][7] - In 2022, 2023, and 2024, water sightseeing services contributed more than 85% of the company's revenue, indicating a heavy reliance on this segment [8] Financial Performance - Shouxihu's revenue has shown an upward trend, with figures of approximately 31 million yuan in 2022, 109 million yuan in 2023, and 111 million yuan in 2024, while net profits have fluctuated [16] - The gross profit margin has varied, with rates of 21.8% in 2022, 59% in 2023, and 54.4% in 2024, reflecting the impact of operational costs and market conditions [16] Market Dynamics - The water sightseeing service market in China is expected to grow from 10.2 billion yuan in 2024 to 18.8 billion yuan by 2029, with a CAGR of approximately 13% [18] - In Jiangsu province, the market is projected to grow from 650 million yuan in 2024 to about 976 million yuan by 2029, with a lower CAGR of 8.5% compared to the national average [20] - Shouxihu ranks second in Jiangsu's water sightseeing market with a market share of about 16% and is ranked tenth nationally with a market share of approximately 1% [20] Operational Challenges - The company faces challenges due to its reliance on ticket sales and the potential for shifts in consumer preferences or increased competition from alternative entertainment options [8][18] - The operational focus is primarily in Yangzhou, making the company susceptible to regional economic fluctuations and regulatory changes [18] Management and Ownership - Shouxihu is controlled by the Yangzhou government, which holds approximately 89.99% of the shares, indicating strong local government support [23] - The management team has extensive experience in the cultural tourism industry, with key executives having backgrounds in various relevant roles [25]

Business Model - The company operates as a state-owned comprehensive water tour service provider, primarily in the Yangzhou Shugang - Shouxihu Scenic Area and the Ancient Canal region, holding exclusive operational rights for water tours for 20 years and in the Ancient Canal area without time limits, capturing a 16.0% market share in Jiangsu's water tour service market [1] Diversified Business Collaboration - In addition to water tour services, the company offers sightseeing bus services and management services, with a fleet of 206 boats and 25 buses, and has introduced innovative service models such as "Boat+" and charter services [2] Financial Performance - The company's revenue has seen significant growth, with total revenues projected at approximately RMB 31 million, RMB 109 million, and RMB 111 million for 2022, 2023, and 2024 respectively, marking a 249.3% increase in 2023 compared to 2022 due to the rebound in tourism post-pandemic and the exclusive operation of sightseeing bus services starting August 2022 [3] - Net profit for the same period is projected at approximately RMB 3 million, RMB 46 million, and RMB 43 million, with a staggering increase of 1,458.1% in 2023 compared to 2022, but a decline of about 7.6% in 2024 due to rising costs [4] Profitability Metrics - Gross margin and net margin have shown volatility, with gross margins of 21.8%, 59.0%, and 54.4% for 2022, 2023, and 2024 respectively, and net margins of 9.5%, 42.6%, and 38.5% for the same years, indicating a significant rise in 2023 followed by a decrease in 2024 [5][6] Revenue Composition - Water tour services remain the primary revenue source, contributing approximately RMB 28 million, RMB 95 million, and RMB 96 million for 2022, 2023, and 2024 respectively, accounting for 88.3%, 87.2%, and 86.2% of total revenue [6][7] Management Team - The company's board consists of nine directors, including six executive directors with extensive experience in the cultural tourism industry, ensuring strong leadership and operational oversight [8] Compensation Growth - The total compensation for directors and senior management has increased significantly, with a 200% rise in 2023 compared to 2022, raising concerns about cost control despite the potential for attracting talent [9]