Trendy culture is linked globally, and domestic brands set sail overseas; super platforms reshape offline services, and emerging experiences blossom at an accelerated pace; travel consumption is both resilient and growing, and the expansion cycle focuses on strong alpha leaders.
The Zhitong Finance App learned that Open Source Securities released a research report saying that focusing on the domestic market, social values are moving towards diversification and inclusiveness, two-dimensional culture is moving towards the public eye, the domestic IP industry enhances superimposed categories and continues to innovate gameplay, and the mid-tier boom in the domestic pan-entertainment market is expected to continue. The emerging service industry is growing rapidly. Small and medium-sized businesses are scattered and rely more on online drainage and operation and maintenance capabilities on platforms, focusing on new online species such as pedicure and massage, pet services, housekeeping services, and aftercare markets. Travel consumers, top-level design encourages the development of the tourism economy. Incremental groups such as Gen Z and people with silver hair continue to expand, and the travel market has medium- to long-term growth; demand-side leisure tourism clearly dominates, showing fragmentation and pursuing cost performance, and online penetration is accelerating.
The main views of Open Source Securities are as follows:
Trendy consumption: global linkage of trendy culture, domestic brands set sail overseas
IP: Jingwei Global, the demand for self-satisfaction resonates during the economic growth transition period. The world is moving towards a trendy gaming era where toys are adulterated, categories are popularized, and women's demand is upgraded. The high performance of leading global toys in the first three quarters of 2024 verified the market situation. Backed by the advantages of the domestic supply chain, with excellent IP localization operation+accurate channel expansion strategies, Bubble Mart's overseas performance increased in all channels in 2024. For Pioneer's advanced overseas giants, there is still plenty of room for overseas IP potential, brand influence, and channel expansion in the middle line. Focusing on the domestic market, social values are moving towards diversity and inclusiveness, and the two-dimensional culture is moving towards the public eye. The domestic IP industry enhances superposition categories and continues to innovate gameplay, and the mid-tier boom in the domestic pan-entertainment market is expected to continue. Beneficiaries: Bubble Mart (09992), Huali Technology (301011.SZ).
Trendy smart wear: Ray-Ban Meta, a second-generation product collaborated by Meta and Ray-Ban, sold more than expected, and aesthetics enabled AI+ glasses to become popular. Recently, Rokid announced that it will hold a RokidJungle 2024 partner and new product launch on November 18. According to Rokid's official poster, Bolon is expected to launch a new eyewear product in collaboration with Rokid. As a French fashion brand, BOLON is positioned as youthful, and the integration of fashion trends and smart wear has become mainstream. Beneficiaries: Doctor Glasses (300622.SZ), Jiayin Intelligence.
AI+ education: Education is one of the most direct and logical application scenarios for the AI wave. Looking back at the successful experience of combining AI in many neighboring countries, Chinese education companies have broad prospects for AI applications, and the beneficiaries are: Good Future (ATL.US), Doushen Education (300010.SZ), Shengtong Co., Ltd. (002559.SZ), ST Kaiyuan (300338.SZ).
Medicine and beauty go overseas, and domestic products rise: From raw materials going overseas to brands going overseas, companies with advantages such as collagen go overseas, and the Southeast Asian market is expected to become the first stop for Chinese medical and aesthetic brands to go overseas. On November 5, Jinbo Biotech announced that its subcutaneous fillers have obtained Vietnam's Class D medical device registration certificate. In addition, Fumei officially launched on Tiktok in Malaysia and Singapore. Beneficiaries: Kinpo Biology (832982.BJ), Giant Life (02367).
Emerging consumption: Super platforms reshape offline services, and emerging experiences bloom at an accelerated pace
Service consumption: Domestic service retail sales increased 6.7% year-on-year from January to September 2024, which is 3.7 percentage points higher than retail sales of goods during the same period. In August 2024, the State Council issued “Opinions on Promoting High-Quality Development of Service Consumption”. The “Cupid Golden Arrow” policy directly targets service consumption and is highly resilient and resilient. There is plenty of room to increase the online rate of the service industry, and super platforms help small and medium-sized businesses hope to restructure the offline service industry. Instant retail: The instant retail market is growing rapidly. Immediate retail demand is moving from “fresh” to “everything at home”, and from “on time” to “on time” to “on time”. A new retail front-end warehouse business format has been created, platform-side giants have increased their layout, and there is a broad demand for fulfilment-side delivery services. Beneficiaries: Dingdong Grocery Shopping (DDL.US) and SF Express Tongcheng (09699).
Emerging business formats: The emerging service industry is growing rapidly. Small and medium-sized businesses are scattered and rely more on online drainage and operation and maintenance capabilities on platforms, focusing on new online varieties such as pedicure and massage, pet services, housekeeping services, and aftercare markets. Beneficiary target: Meituan (03690).
Catering services: In 2024, supply in the catering industry will continue to increase, competition will intensify, and Meituan will empower merchants to increase in all aspects. Open a new coffee and light food business side by side, focus on healthy eating pioneers, and benefit target: Yum Sheng China (09987).
Travel consumption: Combines resilience and growth, and the expansion cycle focuses on strong alpha leaders
The top-level design encourages the development of the tourism economy. Incremental groups such as Gen Z and Yinfa continue to expand, and the travel market has medium- to long-term growth; demand-side leisure tourism clearly dominates, showing fragmentation and pursuing cost performance, and speeding up online penetration. Low-level supply at the B-end has entered a new expansion cycle. Under the homogenization dilemma, competition for the C-side customer base of wine tourism has clearly intensified, and the high operating efficiency base of leading companies is under pressure. Attention is being paid to subsequent trends such as detailed operation of leading stocks, climbing incremental projects, normalization of costs, and strengthening brand barriers. Changbai Mountain (603099.SH), Western Region Tourism (300859.SZ), Jiuhua Tourism (603199.SH), ATAT.US.
OTA channel traffic advantages have been strengthened, platform-side voice has increased markedly, the domestic landscape is stabilizing, and operational efficiency improvements have been realized for many consecutive quarters. It is expected that losses in new businesses will gradually accelerate in the future. Beneficial targets: Ctrip Travel (00780), Tongcheng Travel (00780).
Furthermore, it is also concerned that the expected rise in customs clearance in Hainan in 2025 will bring themed investment opportunities. Beneficiaries: Hainan Airport (600515.SH), China Free Insurance (601888.SH), Haiqi Group (603069.SH).
Risk warning: domestic and global macroeconomic fluctuations; project implementation falls short of expectations; retail falls short of expectations; increased industry competition brought about by new entrants or existing competitors, etc.
