Recently, in order to promote economic recovery, the government introduced a series of major policies to stimulate residents' consumption. Among them, travel consumption occupies an important position in residents' consumption. With the recent rise in the A-share and Hong Kong stock markets and the sharp rise in global Chinese assets, the wealth effect is showing, which will undoubtedly further stimulate consumers' purchasing power. In the medium to long term, the consumption capacity of residents will increase, and tourism consumption will also usher in broad development prospects.

This trend can also be clearly seen from the recent 2024 National Day holiday travel data. According to estimates released by the Ministry of Culture and Tourism, the number of domestic travelers reached 0.765 billion during the National Day holiday this year, achieving a significant increase of 5.9% compared with the same period last year, and an increase of 10.2% compared with the same period in 2019, reflecting the overall recovery and vigorous development of the domestic tourism market and huge space.

Against the backdrop of the growing boom in the cultural tourism market, Haichang Ocean Park (2255.HK) has won enthusiastic popularity and high praise from visitors with its unique charm, diverse activities and perfect travel services, and has become a popular place for tourists to check in. In terms of operation, Haichang Ocean Park has also achieved many highlights, fully demonstrating its strong competitiveness and broad development prospects in the cultural tourism market.

In the future, Haichang Ocean Park will continue to achieve platform-based marine entertainment development through innovation. At the 2024 China Tourism and Leisure Industry Development Conference held recently, Fang Hongfeng, vice president of Haichang Ocean Park, made it clear that Haichang Ocean Park will continue to build on marine culture and launch a new three-legged strategic model combining three business ecosystems. Through multi-dimensional initiatives such as cultural tourism services and solutions, IP operation and new consumption, and theme park operation, it will take advantage of the momentum to achieve the development of a marine entertainment platform to provide visitors with a richer and higher quality travel, leisure and entertainment experience.

1. The number of visitors on the National Day was remarkable. The diverse product matrix was satisfied, and the management strength was highlighted

Looking at specific data, according to information released by Haichang Ocean Park, during the 7-day National Day holiday in 2024, various parks and cultural tourism projects under Haichang Ocean Park received more than 0.8 million visitors, an increase of 7.1% over 2023. This data not only highlights the brand influence of Haichang Ocean Park in the cultural tourism market, but also reflects its outstanding capabilities in tourism services and event planning.

In terms of the number of visitors received, Shanghai Haichang Ocean Park performed particularly well. On October 2 and October 3, the number of visitors to Haichang Ocean Park in Shanghai both broke through the 0.05 million mark in a single day. The supporting hotels Jinqiao Haichang Penguin Resort, Shanghai Haichang Ocean Resort, and Altman Theme Hotel will reach more than 95% for 10 consecutive days from September 28 to October 7, and the unit price will increase 21% over the summer season.

Furthermore, Haichang Ocean Park in Zhengzhou also achieved good results. During the National Day holiday, Haichang Ocean Park in Zhengzhou received more than 0.16 million visitors. The supporting Zhengzhou Haichang Ocean Park Resort and Altman theme hotel continued to fill up during the holiday season, fully demonstrating the strong strength of Haichang Ocean Park in the hotel business.

Among them, Shanghai Haichang Ocean Park launched the “Killer Whale Folk Concert”, where thousands of people sang in chorus at the Killer Whale Theater, and the red flag intersected brilliantly with the killer whales. “Mermaid Fairy Tales” was staged at the Mermaid Light and Film Hall at Volcano Shark Hall. Professional actors wear national costumes and perform ethnic customs under deep water.

In addition to the popularity of theme parks and aquariums, Haichang Ocean Park has also made new progress in its asset-light layout. Recently, Haichang Ocean Park launched a new high-end hotel product, “TheArkHouse Yifang”, which is scheduled to open in July 2025. The high-end hotel project can not only meet the vacation needs of high-net-worth families, but also increase the passenger traffic and revenue of theme parks and aquariums through ticket linkage, etc., which will help the company achieve more steady and sustainable development in the future.

It is easy to imagine that as the number of visitors increases, revenue from park tickets, dining, and shopping will increase accordingly, which can bring performance growth to Haichang Ocean Park. Furthermore, the popularity of the hotel business has also brought considerable benefits to the company. This increase in revenue can enhance the company's profitability and further enhance its competitiveness in the cultural tourism market.

2. The future benefits from multiple logics, and long-term value is further demonstrated

China's tourism industry is actually already the second-largest and one of the fastest-growing travel markets in the world. According to the “2024 Economic Impact Trend Report” issued by the World Travel Council (WTTC), the contribution of China's tourism industry to GDP reached 1.3 trillion US dollars in 2023. WTTC predicts that in the next ten years, China is expected to surpass the US as the world's largest travel market, and the global tourism landscape will profoundly change.

Looking at the medium to long term, as the Federal Reserve enters a cycle of interest rate cuts, since September 25, various departments such as the Central Bank, the Development and Reform Commission, and the Ministry of Finance have intensively released unprecedented stimulus policies, driving a strong rebound in the capital markets of the mainland and Hong Kong. The strong rebound in capital markets has significantly boosted residents' and businesses' confidence in the prospects for economic recovery in the short term.

Furthermore, data shows that consumption in developed countries accounts for more than 70% of GDP, and China has been around 50% in recent years. Experts said that as far as our country's current level of development is concerned, it should reach around 60% within the next 5 years. As residents' disposable income increases and consumption attitudes change, consumer demand for leisure travel is increasing, and more attention is being paid to the quality and experience of travel.

Second, the government's support for the cultural tourism industry has continued to increase in recent years, and has introduced a series of policies and measures to promote the integrated development of cultural tourism. According to statistics from Dongwu Securities, the total number of holiday travelers and total travel revenue increased markedly in 2024, and the unit price for tourists also increased further, which further confirms the rise in industry prosperity.

Based on the characteristics of Haichang Ocean Park's own business model, the main reasons for its growth and value include the following:

Haichang Ocean Park has a diverse cultural tourism product matrix and IP, including theme parks, oceanariums, hotels, etc., which can meet the needs of different visitors. At the same time, the company continues to innovate cultural tourism products, enhancing the tourist experience. The company has successively signed contracts with top international IPs such as “Altman” and “One Piece”. Using high-quality IP potential, the company increases the volume of secondary consumption on the basis of draining and expanding ticket revenue, continuously explores market value, and continuously enhances the company's profitability.

According to the financial report for the first half of 2024, Haichang Ocean Park achieved revenue of 0.8 billion yuan, up 6.8% year on year, and revenue from park operations was 0.74 billion yuan, up 5.5% year on year. Among them, Haichang Ocean Park's new growth engine OAAS (Cultural Tourism Service and Solution) and IP operations played a role. Revenue from OAAS in the first half of the year was about 63.935 million yuan, an increase of 25.05% year on year.

Facing consumers pursue more individualization, diversification and quality, and focus on interactive experiences and emotional feelings, Haichang Ocean Park actively promotes digital transformation, which can more accurately grasp visitors' needs and provide personalized travel products and services, thereby enhancing visitors' sense of participation and interactivity.

Currently, Haichang Ocean Park is following the trend and taking advantage of the momentum, from market recovery to striving to break through high-quality development, shape a brand new “field capacity”, and focus on building a “field” for science and technology, an “field” for emotions, and a “field” for entertainment.

For example, in the construction of a science and technology farm, Haichang Ocean Park has achieved intelligent upgrades in experience, management, and marketing, promoted technologies such as bionic robots, technological mecha devices, and AI technology applications, empowered core projects to operate explosives, promote technological transformation and added value, and form new momentum for product development.

Overall, the combination of new technologies and new business formats spawned by digital technology with the travel industry has made services more convenient and the tourist experience better. According to People's Daily News, China's digital economy will reach 53.9 trillion yuan in 2023. With digital technology, Haichang Ocean Park will undoubtedly usher in huge room for development.