Zhongtong Finance APP learned that since the beginning of 24, the overall stock performance of consumer service demand has been weak. In segmented sectors, scenic spots have relatively outperformed due to the sustained release of leisure tourism demand and the catalysis of cultural tourism hotspots. Hotels in three aspects are facing the pressures of supply rebound and fluctuations in business travel demand, while short-term dining is facing pressures to reduce customer numbers and frequency. The current market is gradually transitioning from a focus on "resilience recovery" to "sustainability" in consumer services. The leisure travel, cost-effective dining, and silver economy sectors are bullish, with a focus on Ctrip (09961), Attadus (ATAT.US), Yum China (09987), Fushouyuan (01448), and Dashi shares (01405).

Tourism and hotels: bullish on the sustainability of leisure travel, with a focus on OTA recommendations.

Sinolink Securities stated that short-term domestic tourism intentions remain high. They focus on incremental contributions to market penetration, inbound tourists, and the elderly population. They predict that the domestic tourism revenue in 24E may increase by 11% year-on-year, and the number of inbound tourists and higher customer unit prices may lead to revenue growth faster than that of domestic tourism, driving the overall tourism revenue (domestic tourism + inbound tourism) to grow at the same rate of 17.5%.

Recommendations: 1) Continuously bullish on OTA platforms that benefit from the continuous release of domestic and foreign leisure demands and the increase of online rates, with a focus on Ctrip; 2) For scenic spots, prioritize manually operated scenic spots with low bases, strong marketing capabilities, and great potential for group recovery, while also focusing on natural scenic spots with elastic demand that are stimulated by improvements in transportation and tourism hotspots; 3) For hotels, we recommend Yatang Hotels, which are efficient and provide excellent service experiences, and are brands that open up incremental space for retail sales.

Dining: H2 base is expected to improve, focus on opportunities for cost-effective products.

Sinolink Securities pointed out that in the first half of the year, there is a high base due to the impact of retaliatory demand release during the same period last year. The latest social retail and catering revenue and catering revenue above quotas are +4.4% respectively, and flat compared to last year. They predict that the high base in the second half of the year is expected to improve. In the short term, high-frequency dining focuses on cost-effective demands. We recommend focusing on opportunities for fast food categories left of positioning, with a focus on Dashi shares and Yum China.

Life services: demand is certain, supply is high, and leading long-term value is outstanding.

According to data from the National Bureau of Statistics, as of 23, there were 297 million people over the age of 60 in China, accounting for 21.1% of the total population, indicating that China has entered an aging society. China has a deep culture of filial piety, and demand for life services is certain. Urban land is scarce, and approval for operational cemeteries is strict, so the industry's supply barriers are high. Fushouyuan has ample available cemetery land reserves and strong service capabilities. From 10 to 23, CAGR of revenue and net profit attributable to mothers are 16.8% and 16.9%, respectively, showing strong growth continuity. Capital expenditures have fallen and cash flows are abundant, and future dividends are expected to continue to rise.

Risk warning: Consumer demand may not be released as expected, labor shortages, raw material prices may rise sharply, etc.