Bottom line: Legoland’s new Shanghai theme park spotlights the growing lure of China’s leisure travel market, while Royal Caribbean’s removal of South Korean ports from its China-based trips spotlights how political tensions can affect tourism-reliant businesses.
Legoland coming to China
A couple of Shanghai-based leisure stories are spotlighting two very different trends in China’s leisure travel sector, where a burgeoning middle-class is seeking new and interesting vacation ideas. On the more upbeat side, one of Europe’s top theme park developers is expressing a major vote of confidence in the market, with word that the developer of Legoland theme parks will open one of its mega-resorts in Shanghai. But on the downside, the country’s largest cruise operator, Royal Caribbean (NYSE: RCL), has removed South Korean ports from its China-based trips amid growing frictions between Beijing and Seoul over a controversial missile defense system. Read Full Post…
Bottom line: Ctrip’s stock could be set for strong gains over the next 12 months, thanks to strong profit growth following its recent string of equity tie-ups that have neutralized most of its major competitors.
Ctrip neutralizes rivals with string of tie-ups
In this series on my favorite China-concept stocks, leading online travel agent Ctrip (Nasdaq: CTRP) is the only one that I don’t really like in terms of corporate personality. But that fact aside, there’s still plenty for investors to like about this company that has slowly built up an enviable empire in China’s fast-growing market for travel services.
Ctrip was ahead of the curve with its establishment back in 1999 when China’s Internet and travel industry were both in their infancy. It was also one of China’s earliest Internet companies to list in the US, making a New York IPO back in 2003. Since then its prospects have soared with China’s booming travel industry, as the company faced relatively little competition for most of its first decade in business. Read Full Post…
Bottom line: Ctrip’s explanation for a recent major share sale by top executives looks reasonable and shouldn’t be cause for concern, while Tuniu won’t gain any short-term advantage from its new war with Tongcheng.
Ctrip execs invest in cruising
A couple of news bits are cruising through the online travel space this first week, with industry leader Ctrip (Nasdaq: CTRP) and recently listed Tuniu (Nasdaq: TOUR) both engaged in new strategic moves. In the former case, Ctrip is explaining a recent wave of selling of its shares by top company executives, saying the move was prompted by their need for cash for a new strategic investment. The latter case has Tuniu reportedly engaged in an entertaining behind-the-scenes battle with unlisted rival Tongcheng for the lucrative and fast-growing overseas travel market. Read Full Post…
China’s broader domestic travel market may be quickly getting saturated, but that hasn’t stopped leading online travel agent Ctrip (Nasdaq: CTRP) and global hotel giant Starwood (NYSE: HOT) from seeking out new investment opportunities in more niche-focused areas. News involving the former will see Ctrip purchase a cruise liner from global giant Royal Caribbean (NYSE: RCL) to capitalize on the rising popularity for ocean cruises among Chinese vacationers. The latter news bit will see Starwood, owner of the Westin and Sheraton hotel brands, open an ambitious 4 new resorts on the tourist-friendly Hainan island over the next 5 years. Read Full Post…
The following press releases and media reports about Chinese companies were carried on September 3. To view a full article or story, click on the link next to the headline.
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US Business Lobby Says Concerned China Antitrust Probes Unfair (English article)
Ctrip (Nasdaq: CTRP) To Buy Celebrity Century Shop From Royal Caribbean (NYSE: RCL) (PRNewswire)
Trina Solar (NYSE: TSL) Acquires Majority Of Yunnan Metallurgical New Energy (PRNewswire)
KKR Sells Final Stake In China Modern Dairy (HKEx: 1117) For $80 Mln: Source (English article)
Tencent (HKEx: 700) Invests $70 Mln In Online Medical Portal DXY (English article)
I often write about the travel and leisure industry in this space, with special focus on hotels and online travel agents that are reaping big profits from China’s fast growing middle class with plenty of money to spend on vacations. But another less visible group set to profit from the boom is the cruise industry, which is rapidly discovering a Chinese fondness for traveling aboard vacation palaces at sea. A new report on the trend seemed like a good opportunity to focus on the market, which looks set to offer big growth potential for industry leaders Carnival Corp (NYSE: CCL) and Royal Caribbean (NYSE: RCL). Read Full Post…
