Tourism Boom Sends Ctrip Group Soaring: Stock Poised to Hit HKD 600 as Holiday Demand Skyrockets!

Fuel Up for next Tuesday: Internet Chinese Giants will Surge as Mainland Investors Return.

DON'T MISS THE NEXT BIG RALLY. 

$TRIP.COM-S(09961)$ 

$MEITUAN-W(03690)$ 

$PDD Holdings Inc(PDD)$ 

$HSI(HSI)$ 

$Trip.com Group Limited(TCOM)$ 

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Today, October 4th, Ctrip Group (09961.HK) hit an all-time high, reaching HKD 545, making it the most expensive stock on the Hong Kong Stock Exchange. This surge is fueled by a booming travel season during China’s National Day holiday, as highlighted in Ctrip’s "2024 National Day Travel Forecast Report," which anticipates record-breaking domestic trips and tourism spending.

International flight bookings for the holiday have doubled, with accommodations around popular tourist spots fully booked. Feizhu’s data shows that the number of passengers flying on the first day of the holiday surged by over 50% compared to last year, while domestic car rental orders rose more than 40% year-over-year.

Globally, the travel sector’s recovery is progressing unevenly. From January to July 2024, Europe and the Americas saw over 95% recovery, while the Middle East and Africa outperformed 2019 figures, growing by 26% and 7%, respectively. The Asia-Pacific region lags behind, recovering to 82% of 2019 levels. However, China is accelerating, with holiday travel growth surpassing international markets. The Ministry of Culture and Tourism estimates domestic tourist numbers to reach 4.29 billion in the first three quarters of 2024, nearing 2019’s peak.

Looking forward, Chinese internet giants Meituan-W (03690), Pinduoduo (PDD), and Ctrip Group (09961) are seen as the top trio for long-term growth in China’s internet sector. Jefferies predicts sustained demand for local services and OTAs, with companies like Meituan, Ctrip, and Tongcheng well-positioned for strong profitability. As post-pandemic recovery continues, these stocks could see spectacular gains.

China’s visa-free entry policy is also expected to drive a substantial increase in tourism, benefiting Ctrip, which dominates China’s OTA market, similar to how Booking.com and Expedia lead elsewhere. Ctrip reported a 13.55% year-over-year revenue growth in Q2 2024, reaching RMB 12.788 billion (USD 1.8 billion), solidifying its dominance. Its ownership of MakeMyTrip, India’s largest OTA, further boosts its global reach.

Despite these fundamentals, Ctrip’s share price has not risen as dramatically as other Chinese stocks, presenting an appealing opportunity for investors. With mainland investors returning after a week-long holiday, we could see a significant surge in several stocks. In the short term, Ctrip's stock price could easily reach HKD 600.

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