According to the Zhitong Finance and Economics app, DBS published a report pointing out that the tourism boom is reigniting, with outbound passenger traffic from the mainland more than doubling in the first seven months, but still only accounting for 84% of the 2019 level. Outbound tourism accounts for about 13% of Ctrip's (09961) revenue last year. The bank maintains a "buy" rating on Ctrip, raising the target price from 558 yuan to 620 yuan, with profit forecasts remaining unchanged, while the annual net profit forecasts for 2024 to 2026 are expected to increase by 34%, 16%, and 14% respectively after adjustments.

The bank mentioned that benefiting from operating leverage, Ctrip's management maintains an optimistic attitude towards the profit margin of its domestic business, reducing investors' concerns about the pressure on gross profit due to the decline in average daily room rates. At the same time, Ctrip's overseas platform Trip.com achieved profit and loss balance in the fourth quarter of last year, forecasted to generate positive gross profit contributions in the coming years, possibly exceeding 30% in the long run. With the increasing contribution of Ctrip's high-profit margin outbound business, combined with the stable contributions from domestic and overseas platforms, it is expected to help the company achieve a core net profit margin of 34% to 35% over the next three years. In addition, supported by visa-free policies, the bank expects the company's international business revenue to achieve a compound annual growth rate of 30% over the next three years, accounting for approximately 27% of its total revenue in the 2026 fiscal year.