We expect Tongcheng Travel’s revenue to return to growth as China relaxes its reopening policies, which should allow its citizens to travel with fewer restrictions. We expect near-term revenue to increase modestly, driven by the recovery of the travel industry. Assuming no return of lockdown headwinds in China, we expect Tongcheng’s revenue to increase 10%-15% per year in the near- to midterm.
Tongcheng has very low penetration in Tier 3 cities and has less than a 30% saturation rate in its target market.
Reopening may not be as smooth as expected, leading to a prolonged slump in travel.
|
Metric
|
00780
|
TCOM
|
03690
|
|---|---|---|---|
Price/Earnings (Normalized) | 6.95 | 10.24 | 11.73 |
Price/Book Value | 0.87 | 1.04 | 2.27 |
Price/Sales | 1.05 | 2.77 | 1.02 |
Price/Cash Flow | 5.46 | 9.68 | — |
|
Metric
|
00780
|
TCOM
|
03690
|
|---|---|---|---|
Quick Ratio | 1.17 | 1.05 | 1.63 |
Current Ratio | 1.46 | 1.33 | 1.91 |
Interest Coverage | 14.06 | 54.03 | −15.64 |
|
Metric
|
00780
|
TCOM
|
03690
|
|---|---|---|---|
Return on Assets (Normalized) | 8.56% | 11.94% | −9.47% |
Return on Equity (Normalized) | 16.17% | 19.30% | −19.94% |
Return on Invested Capital (Normalized) | 12.93% | 15.17% | −13.42% |
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1-Day Chart
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