Hong Kong Stock Concept Tracking|Travel popularity during the “May Day” holiday in 2025 may peak in nearly 3 years, leading travel companies will benefit (with concept stocks)

The May Day holiday is approaching, and the travel market is at a peak in bookings.

According to Tuniu data, the number of May Day travelers doubled year-on-year. Domestic long-term trips accounted for 40%, and outbound short-term trips accounted for 30%. Among them, Japan and Southeast Asia were the most popular. Southern cities such as Xishuangbanna, Guilin, and Xiamen are popular in China, and the proportion of free and self-driving tours continues to rise. Some outbound routes have been sold out, and there is still room for domestic travel.

On April 16, train tickets went on sale the day before the May 1st holiday. On the Where to Go platform, passenger traffic from the northern region to Beijing, Guangzhou, Fuzhou, Xiamen, Changsha, Qingdao and other places in the Yangtze River Delta is booming. Ticket sources for routes such as Beijing-Wuhan, Beijing-Zhengzhou, Luoyang, Shanghai-Fuzhou, and Shanghai-Changsha are tight, making purchasing tickets no less difficult than the Spring Festival travel season.

On April 15, Tongcheng Travel released the “2025 “May Day” Tourism Trend Insight Report.

The report shows that during the “May 1st” holiday this year, mass tourism demand represented by users in non-first-tier cities will continue to drive the holiday economy to flourish. Through vacation and other methods, users will not only have more time to experience more “treasure counties” in depth, but the scope of their itinerary will also expand from home to overseas. According to Tongcheng travel data, in addition to popular domestic destinations such as Beijing, Chengdu, and Shanghai, South Korea, Japan, Singapore, and Thailand will leave more tourists' travel trajectories. As people's travel spending potential increases, the popularity of domestic high-star hotel reservations far exceeds that of three-star hotels and below.

Hong Kong stocks of leading companies related to tourist hotels:

Ctrip Group-S (09961): In early March, Yamato released a research report stating that it maintained the Ctrip Group-S (09961) “buy” rating and raised the target price from HK$705 to HK$735. The bank raised Ctrip's earnings forecast per share from 2025 to 2027 by 3% to 5%, and expects revenue growth of 58% year-on-year in 2025. Yamato pointed out that even though the outside world is concerned about the “downgrade effect,” Chinese consumer spending is still strong, and consumers are showing a stronger desire to travel long distances. Even if the supply of hotel chains increases and the pressure on average housing prices in the industry may continue in the first quarter of this year, the year-on-year decline in Ctrip's average hotel prices in China is lower than the mid-single-digit year-on-year decline in the industry.

Tongcheng Travel (00780): In late March, Morgan Stanley released a research report stating that it would raise the revenue forecast for Tongcheng Travel (00780) by 2% to 3% from 2025 to 2026. It also indicated that due to strong operating leverage, the company's diluted earnings per share forecast for today and next two years was raised by 9.9% and 6%, respectively. The bank raised its target price from HK$25 to HK$26, and the rating was “increased”.

Huazhu Group-S (01179): In mid-March, Yamato released a research report saying that the adjusted EBITDA of Huazhu Group-S (01179) in the fourth quarter of fiscal year 2024 increased 10% year-on-year, which is generally in line with market expectations. After considering the faster expansion of the hotel network than expected, the bank raised Huazhu's EBITDA forecast for the 2025-2026 fiscal year by 1% to 2%, and raised the target price of H shares from HK$27.5 to HK$31.5, maintaining a “outperforming the market” rating.