Incidents:
The company released its 2023 annual report. In 2023, the company achieved operating income of 3.4 billion yuan, +229.02% year-on-year; in 2023, the company achieved net profit of 688.3878 million yuan, and realized net profit deducted from non-mother of 59.7744 million yuan, all of which significantly turned losses into profits over the previous year.
The business travel business ushered in full recovery and accelerated development. In terms of outbound travel business, the company laid out ahead of schedule, accelerated supply chain reshaping, strengthened in-depth exchanges and cooperation with global tourism agencies and suppliers, added more than 100 new resource suppliers, organized 50 initial trips to destinations such as Egypt, the United Arab Emirates, Kenya, Russia, New Zealand, Hungary, Spain, South Africa, etc., covering more than 60 countries and regions, and the number of outbound travel teams ranked among the highest in the country; in terms of domestic travel business, using the national layout and network channels of local subsidiaries, the company targeted scenic spots, hotels, transportation and other resources in tourist hotspots ahead of time, and used domestic The tourism market is a hot opportunity to promote the collaboration and common development of “group organization” and “ground connection” business resources.
The lodging industry is developing well, and the revenue scale exceeds the level of 2019. The company's lodging industry achieved high growth and steady growth throughout the year, and the revenue scale increased by 9.21% compared to 2019. In terms of the hotel management business, the scale of management continued to expand, and management output capabilities continued to increase. A total of 31 management projects were expanded during the reporting period. At the same time, Lingnan Hotels innovated the “sub-area integration” and “sub-brand operation” management model to improve operation management efficiency for original hotel management projects, and achieved remarkable results in improving management efficiency, integrating marketing channels, strengthening marketing linkage, complementarity and mutual promotion of customer sources, and reducing costs and expenses.
The diversified “Travel+” business accelerated development and teamed up with Ehang to intelligently lay out a low-altitude economy. During the reporting period, Guangzhou Travel Yuejing Company successfully signed a contract with Gaodang Scenic Area in Guizhou. Since this year, it has agreed on more than 10 planned scenic spot operation and development projects, further enhancing the company's destination tourism resources. In 2020, Lingnan Holdings reached a strategic cooperation with Ehang Intelligence. The two sides will use the application of intelligent autonomous vehicles (AAV) in the tourism industry as an entry point to jointly build an “urban air traffic (UAM) + pan-tourism ecosystem” industry cooperation model to create a new paradigm of application in the air traffic industry and a new smart tourism ecosystem.
Profit forecast: Business travel boom recovers. We expect the company's revenue for 2024-2026 to be 59.2/74.6/85.8 yuan, and the net profit to mother for 2024-2026 will be 2.58/ 2.81/292 million yuan, respectively, and the corresponding PE will be 24.22/ 21 times, respectively. The 2024E EPS was given a 30-times PE valuation, corresponding to the target price of 11.56 yuan. It was covered for the first time, and a “buy” rating was given.
Risk warning: Low-altitude economic progress falls short of expectations, profit forecasts and valuation judgments fall short of expectations