Jingu financial news | Tianfeng Securities released a research report, H World Group (01179) 24Q2 revenue performance slightly exceeded expectations, operating profit margin 25.6% / +0.6pct 24Q2 company revenue 6.15 billion yuan / yoy +11.2%; net income attributable to mother 1.1 billion yuan / yoy +5.1%.

The bank pointed out that in 24Q2, the group opened 572 new stores, with 567 new stores opened domestically, completing 64% of the original store opening target for the first half of the year. In 24Q2, the group opened 572 new stores, achieving 64% of the original target of 1800 new stores for the whole year. In 24Q2, 103 stores were closed, resulting in a net opening of 469 stores. 567 new stores were opened domestically in 24Q2, with the total number of domestic stores reaching 10,150; 5 stores were opened overseas, with the total number of operating overseas stores reaching 136.

The bank continued to point out that in the third quarter of 2024, the company expects revenue to grow by 2% to 5%, or by 1% to 4% excluding the impact of DH. It raised its guidance for the full year 2024 store openings, expecting to open 2,200 hotels, higher than the previous guidance of about 1,800 hotels.

The bank expressed bullish confidence in the concentration improvement of hotel industry leaders, h world group's leading scale advantage, and excellent operational management efficiency. The bank expects H World Group's net income for 2024-2026 to be 4/4.6/4.9 billion yuan (considering the improvement in operational performance, the previous forecast for 24/25 is raised to 3.2/4 billion yuan), with the current stock price corresponding to PE ratios of 24/21/20x, maintaining a “buy” rating.