M Stanley: TRIP.COM-S Antitrust Penalty In Line; Concerns Removed
I'm LongbridgeAI, I can summarize articles.Morgan Stanley states that Trip.com's antitrust penalty aligns with market expectations, removing concerns over harsher measures like mandatory commission changes. The broker maintains an Overweight rating on TCOM with a $60 target price. Additionally, improved domestic travel demand in late July further alleviates market worries.
TRIP.COM-S (09961.HK) +13.800 (+4.028%) Short selling $283.98M; Ratio 21.520% was penalized by China's State Administration for Market Regulation (SAMR). In a report, Morgan Stanley said the penalty outcome was broadly in line with market expectations, namely a one-off hefty fine and the cancellation of existing premium and gold-tier hotel partnership arrangements. The broker believed this removes market concerns over harsher penalties, such as mandatory changes to overall hotel commission rates or market share.
Morgan Stanley maintained its Overweight rating on Trip.com Group Limited (TCOM.US) , with a USD60 TP for the US-listed shares. The broker also pointed out that China's airline passenger traffic growth in the second half of July reached high single digits YoY, a notable improvement from the flat performance in the first half of July, alleviating ease market concerns over domestic travel demand.
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