Daiwa has reiterated its "outperform" rating on HWORLD-S (01179) and raised the target price from HK$30.5 to HK$36.5. The upgrade is primarily driven by faster-than-expected recovery in RevPAR (Revenue per Available Room), prompting an 11% to 13% increase in the company's EBITDA forecasts for 2025–2027.

The firm noted HWORLD-S's robust Q3 performance, with adjusted EBITDA growing 19% year-on-year to RMB2.513 billion, surpassing market expectations of RMB2.414 billion. Adjusted EBITDA margin also expanded by 3.3 percentage points to 36.1% year-on-year.

Daiwa believes the temporary oversupply in China's hotel industry has eased over the past two to three months, which should support a rebound in RevPAR across the sector.