Safety point of view:
The growth boundary of the company: 1) China's tourism industry is a big market of more than 10 trillion yuan, with more than 6 billion domestic tourists, but the linearization rate is only 16.7% (about 55% in European and American markets). There is plenty of room for OTA to tap. 2) upstream hotel industry-short-term economic type (> 60%), long-term olive structural trend (50% in Europe and the United States). The proportion of high consumption level users in Ctrip is as high as 82.2%, the revenue of high-end wine and travel accounts for nearly 80%, and the commission rate is raised to 9%. The goal of "high-end" is clear. 3) in 2021, 51.2% of users plan to travel around China within 3 hours (short-term hot spots), and long-term focus on quality tourism (the proportion of 2017-2021E quality leisure travel increased from 25.9% to 31%). Ctrip is listed on the Hong Kong Stock Exchange for the second time and plans to make high-frequency short-distance tours around the country and local tours. 4) the sinking market has great potential: the online travel APP installation rate of mobile phone users in third-tier cities and below is only 18%. More than 70% of new OTA users in 2020 came from the sinking market. Ctrip joined hands with its travel know-how to join the mode of laying offline stores, the current total number of stores reached more than 6000.
Ctrip's core competitiveness lies in the scale advantage and brand effect formed by the layout of the whole industry chain: 1) China's OTA market is highly concentrated, with "Ctrip system" accounting for more than 50% (GMV caliber), ranking first for many years in a row. 2) Ctrip Group cobweb investment M & A logic, open upstream and downstream, vertical and horizontal OTA market, business and products cover all tracks and series, 2021 focus on "content marketing" drainage, and gradually achieve the goal of "leading one-stop travel platform". 3) "Ctrip Travel" APP brand awareness ranked first, user stickiness leading the industry, three-year buyback rate of more than 70%, 2020.8-TGI index reached 258.1, far surpassing Flying Pig and Little Red Book. 4) Ctrip has the largest and most professional customer service call center in the world's OTA enterprises. Relying on self-developed AI technology, it has gradually changed to intelligence, and labor costs can be further reduced.
There is a long way to go, and there is a long way to go: 1) during the post-epidemic period, it will take time for the company's order quantity and commission rate to recover, and the outbound travel business will be difficult to recover in the short term; 2) Ali will compose Gaode, ele.me and flying pig into a life service sector. compete with Meituan for the "wine tour" business, and the market competition intensifies. 3) Department of Aviation & Railway ticketing direct selling model deepens, price war continues, online transportation commission rate is difficult to increase (air tickets and train tickets are reduced to about 2%), competition for new customers to expand GMV is the key; 4) Booking and Expedia are more competitive internationally (Booking commission rate of 19.2% in 2020 > Expedia14.1% Ctrip 3.7% market capitalization is 4 times that of Ctrip, revenue is more than 3 times), Ctrip "internationalization"
take a heavy burden and embark on a long road.
Profit forecast: we predict that the company's revenue from 2021 to 2023 will be 22.222 billion yuan, 34.068 billion yuan and 41.736 billion yuan respectively, the net profit will be 1.731 billion yuan, 4.758 billion yuan and 6.364 billion yuan respectively, and the EPS will be 2.72 yuan, 7.46 yuan and 9.98 yuan respectively. The PE corresponding to the current stock price is 60.1,21.8,16.3 times, respectively. We think that the recovery trend of online tourism will be determined in the next 1-2 years. 3-4 years later, outbound travel and high-end wine travel gradually become the mainstream, given a "recommended" rating. The short-term epidemic suppresses the supply and demand of the industry, the "dark moment" is about to pass, and the recovery (especially the liberalization of immigration policy) will eventually lead the OTA leader to "dance".
Risk tips: 1) the impact of the epidemic: 2021Q1's revenue dropped by 13.2% compared with the same period last year, the epidemic broke out again in July, the transmission chain was prolonged, the summer tour ended ahead of schedule, and overseas business still did not improve; 2) Industry policy changes: recent national policy risks in anti-monopoly and data security of platform Internet companies can not be ignored. 3) the decline of commission rate: the deepening of the direct sales model of upstream hotel and ticket booking will further compress the profits of agents; 4) the impact of major negative events; 5) the intensification of external competition: in the near future, Ali will compete with its Gaode, local life and Flying Pig synthetic life service sectors to compete for the high-margin "wine travel" business. Ctrip's 2021 layout of the new model of "content marketing" is facing competition with traffic-starting platforms such as Little Red Book, Douyin and bilibili.