WanLian Security's 25-Year Mid-Season Report Overview of the Social Service Industry: Revenue and Profit Both Increase, Marginal Improvement in Tourist Attractions

According to the Zhitong Finance APP, WanLian Securities released a research report stating that in the first half of 2025, the performance of listed companies will be announced, with both revenue and profit in the social services sector increasing. The total operating revenue reached 95.436 billion yuan, a year-on-year increase of 5.44%; the net profit attributable to shareholders was 4.870 billion yuan, a year-on-year increase of 1.13%. Among them, the tourism and scenic area sector achieved revenue of 16.610 billion yuan in the first half of 2025, a year-on-year increase of 4.39%, with a net profit attributable to shareholders of 1.041 billion yuan, a year-on-year decrease of 4.30%. Driven by the continuous recovery of residents' travel demand and policy support, the revenue of tourism and scenic area companies has rebounded. Weak consumer demand has put pressure on the profits of the hotel and catering sector. If the consumption environment improves in the second half of the year, it may drive the recovery of the catering business, leaving room for improvement in the sector's performance. WanLian Securities' main viewpoints are as follows: The social services sector saw dual increases in revenue and profit in the first half of the year, ranking high in performance In the first half of 2025, the performance of listed companies was announced, with the social services sector experiencing dual increases in revenue and profit. The total operating revenue reached 95.436 billion yuan, a year-on-year increase of 5.44%, ranking 9th among Shenwan's first-level industries; the net profit attributable to shareholders was 4.870 billion yuan, a year-on-year increase of 1.13%, ranking 16th among Shenwan's first-level industries. Tourism and scenic area sector In the first half of 2025, the tourism and scenic area sector achieved revenue of 16.610 billion yuan, a year-on-year increase of 4.39%, with a net profit attributable to shareholders of 1.041 billion yuan, a year-on-year decrease of 4.30%. Driven by the continuous recovery of residents' travel demand and policy support, the revenue of tourism and scenic area companies has rebounded. From the May Day Golden Week tourism data, residents' enthusiasm for travel is high, and the tourism market continues to recover. The 240-hour visa-free entry stay time, combined with the newly introduced "buy and refund immediately" tax refund policy, has jointly pushed the number of inbound visitors to new heights. The reduction of adjusted working days has led more tourists to choose to take early bird trips or staggered trips at the end of the holiday, promoting strong performance in long-distance travel destinations. Various regions are innovating and enriching consumption scenarios, stimulating consumption potential and market vitality, and providing tourists with in-depth experiences. Hotel and catering sector In the first half of 2025, the hotel and catering sector achieved revenue of 14.056 billion yuan, a year-on-year decrease of 3.40%, with a net profit attributable to shareholders of 708 million yuan, a year-on-year decrease of 40.36%. The performance of individual stocks in the sector was generally poor, with only BTG Hotels showing a year-on-year increase in net profit attributable to shareholders, while other stocks reported losses or declines in profit year-on-year. The weak consumer demand in the first half of the year has put pressure on the sector's profits. If the consumption environment improves in the second half of the year, it may drive the recovery of the catering business, leaving room for improvement in the sector's performance. Investment advice: To support stable economic growth, boosting consumption and expanding domestic demand become the core paths The potential of the sinking market continues to be released, solidifying the foundation for consumption, while overseas expansion opens up new growth space. At the same time, the proportion of service consumption is approaching the critical point of 50%, which is expected to accelerate its transformation into the main body of residents' consumption. The transformation of economic growth momentum drives a cyclical β market for consumption, creating systemic opportunities through the release of effective demand and optimization of service structure. In the second half of the year, the implementation and optimization of the national visa-free policy will continue to drive the tourism market; the establishment of duty-free shops in cities will also bring new development opportunities to the duty-free industry; the county commercial system is gradually improving, and the benefits of the sinking market will gradually emerge, with the hotel and chain catering industries expected to accelerate expansion; The education sector is expected to become a representative application scenario for artificial intelligence. It is recommended to pay attention to leading companies in tourism, duty-free, hotels, catering, and education that benefit from favorable policies. Risk Factors Risks of natural disasters and safety incidents; policy risks; risks of macroeconomic performance being below expectations