China Travel_OTA_ Resilient with no surprises....what the data tells us about Chinese New Year travel trends

Summary of Conference Call Notes Industry Overview - Industry: China Travel/OTA, Global Hotel & Leisure - Key Event: Chinese New Year (CNY) travel trends and spending data Key Points and Arguments 1. Domestic Spending Growth: Total domestic spending during CNY increased by 7.0% YoY, with a 5.9% increase in trips and a 1.2% increase in average spend per trip [2][13][16] 2. Peak Travel Season Performance: During the peak travel season, trip growth was higher at 7.6% YoY, indicating strong travel activity despite macroeconomic challenges [2][13] 3. Family Travel Trends: Increased family-oriented trips contributed to lower per capita spending, as families opted for more economical accommodations [3][47] 4. Outbound Travel Growth: Total outbound trips grew by 6.3% YoY to 14.4 million, with Chinese citizens taking 7.67 million trips, reflecting a 5% increase. Excluding trips to Hong Kong and Macau, international outbound travelers grew by 31% YoY [4][52][54] 5. Hotel and Air Travel Resilience: Hotel occupancy and average daily rates (ADR) are expected to improve during CNY, with domestic air travel growing at 7% YoY [5][61] 6. Spending Patterns: Average spending per traveler during CNY was RMB 1,351, reflecting a 1.2% increase YoY, but overall spending was impacted by family travel dynamics [2][19][30] 7. Longer Vacations: Travelers are increasingly taking longer vacations and exploring further destinations, particularly younger consumers engaging in winter sports [3][44] 8. Market Outlook for TCOM: TCOM is rated as an outperformer, with a target price adjustment to USD 80/HKD 620, reflecting a slight downward revision in revenue and EPS estimates due to softer travel data [8][9] 9. Flight Capacity Trends: Outbound flight capacity increased by 23% YoY, with Japan and Southeast Asia remaining popular destinations [55][60] 10. Hotel Market Dynamics: The hotel sector is expected to grow at a mid-single-digit (MSD) rate, driven by consumption upgrades and increased demand for high-end accommodations [61][62] Additional Important Insights - Consumer Behavior: The trend of family travel is becoming more pronounced, with families making up a larger proportion of total travelers during CNY [48][49] - Regional Travel Growth: Heilongjiang province saw significant increases in both visits (+18%) and spending (+24%), highlighting regional travel dynamics [3][44] - CNY Travel Data Limitations: Official CNY data may understate actual growth due to additional holidays and travel patterns extending beyond the official holiday period [16][17] - Future Demand Expectations: The outlook for travel demand is expected to improve in Q2 and Q3, with a potential acceleration in growth as consumer confidence builds [89] This summary encapsulates the key findings and insights from the conference call, providing a comprehensive overview of the current state and future outlook of the China travel and hotel industry during the Chinese New Year period.