Since 2022, the tourism industry has continued its recovery trajectory, with tourist visits rebounding rapidly at double-digit compound growth rates. This momentum has sustained through 2025, with major holidays including Spring Festival, Qingming, May Day, and Dragon Boat Festival all achieving record highs. As the upcoming National Day approaches, data from multiple OTA platforms indicates exceptionally strong travel enthusiasm.
According to TRIP.COM-S's 2025 National Day Tourism Trend Forecast Report, cross-provincial travel orders on the platform have surged over 40% during the National Day holiday, with outbound tourism experiencing explosive growth. Notably, holiday orders to Kenya and Tanzania have increased by 130% year-over-year. Additionally, Fliggy's "2025 Mid-Autumn and National Day Holiday Travel Trend Report" shows that searches for hotels and attractions near popular performance venues have increased 1.5 times compared to last year. For scenic spots, popular ancient town destinations including Wuzhen, Gubei Water Town, Wujiang Village, and Chikan Ancient Town have seen tourism product bookings surge over 120% year-over-year.
These impressive National Day booking figures are expected to reflect positively in capital markets, creating investment opportunities as the tourism industry chain benefits from increased capital interest. In terms of specific targets, the OTA sector has led recent gains, with TRIP.COM-S rising for three consecutive months and achieving market value increases exceeding 30%. TONGCHENGTRAVEL has also posted solid gains of 20%. National Day tourism data is expected to exceed expectations, potentially ushering in a new upward cycle for the sector.
**Strong Tourism Recovery: Three Major Changes in 2025**
Three quarters into 2025, the entire tourism industry continues to show sustained improvement in business conditions, with the Chinese market leading globally. Domestic resident travel reached 3.285 billion trips, growing 20.6% year-over-year, with third-quarter growth expected to continue. International tourism has also achieved steady recovery, with global international visitor numbers reaching 690 million in the first half, up 5% year-over-year. Benefiting from China's strong performance, the Asia-Pacific region maintains double-digit growth rates.
China has consistently served as a barometer for global tourism markets. In 2025, major holidays including New Year, Spring Festival, Qingming, May Day, and Dragon Boat Festival all achieved three-year highs in tourist numbers. The upcoming Mid-Autumn and National Day overlap creates an 8-day extended holiday, intensifying travel intentions. Based on online travel platform data, double-digit growth is anticipated.
The domestic tourism industry has undergone significant changes in 2025, primarily manifested in three areas:
First, mass tourism consumption trends are evident, with lower-tier cities in sinking markets showing significantly increased tourism participation. In the first two quarters of this year, rural tourism growth exceeded urban rates, with Q1 achieving 39.2% growth and tourism consumption growing 39.6%, demonstrating rural areas' enormous consumer potential. OTA platforms like TONGCHENGTRAVEL report that most new paying users come from second-tier and lower cities.
Second, tourism structures are being reshaped, with short-haul and long-haul travel redistribution, both emphasizing enhanced experiences and frequent innovative tourism models. Weekend getaways have become routine, with markets continuously launching quality tourism products such as high-end customized tour groups and luxury cruise travel to meet diverse needs across age demographics. In product innovation, models like tourism + film/TV, tourism + entertainment, and tourism + education are driving deeper vertical product development.
Third, AI capabilities are evolving, empowering the entire industry chain and driving the emergence of new AI tourism sectors. TRIP.COM-S launched its Wenxin large language model in 2023 and initiated Tourism Platform 3.0 mode this year. Other competitors have followed suit, with TONGCHENGTRAVEL's Chengxin AI integrating DeepSeek to provide AI + real-time booking services, while Fliggy launched travel AI "Ask Away," integrating multiple large models including DeepSeek. Beyond OTA platforms, destination and hotel brands are also increasing AI investments, such as Huangshan Tourism's Tuma Technology fully integrating the Huangshan AI Travel Assistant with DeepSeek.
These three changes will significantly boost both travel frequency and per-trip spending levels while covering broader demographics under mass tourism trends. Additionally, AI has created new demand sectors, opening market space across all tourism industry chain segments. Policy support has also intensified, including measures outlined in the State Council's "Several Measures on Further Cultivating New Growth Points and Prospering Culture and Tourism Consumption" issued in January, with local governments implementing new supportive policies during each holiday to continuously drive stable tourism industry growth.
**Sector Welcomes Investment Opportunities: Focus on Segment Leaders**
The tourism industry's continued recovery and the wave of AI + tourism sectors will generate investment opportunities across the industry chain. OTA platforms, serving as industry bellwethers, are receiving early capital allocation, with industry leaders like TRIP.COM-S and TONGCHENGTRAVEL positioned to benefit first.
TRIP.COM-S maintains steady performance growth, with both accommodation booking and transportation ticketing businesses achieving double-digit growth in the first half of this year. Hotel accommodation booking and international business serve as core growth drivers, with revenue growth exceeding 20%. Overseas business momentum is strong, with steady Southeast Asian market expansion. The company established an Asian live streaming center in Thailand in 2024 and further strengthened cooperation with Thailand and Malaysia this year, maintaining leading market share in Southeast Asia.
Multiple investment banks view the company favorably. Research indicates that TRIP.COM-S, as the domestic OTA industry leader, has established deep competitive moats in supply chain, user mindshare, and global resource integration. Domestic tourism market recovery provides stable support for domestic business growth, while inbound/outbound and international business serve as core drivers for medium to long-term performance growth. Projected revenues for 2025-2027 are 62/71.2/80.9 billion yuan respectively, with Non-GAAP net profits of 19.4/22.4/25.6 billion yuan respectively.
TONGCHENGTRAVEL has become the largest OTA platform for sinking market users, with non-first-tier city registered users comprising 87% in 2025. Cumulative service users and annual paying users both maintain growth trends, driving high performance growth. In the first half, the company continued focusing on sinking markets while enhancing user experience through product innovation and AI applications, with both accommodation booking and transportation ticketing businesses maintaining double-digit growth.
Research reports indicate TONGCHENGTRAVEL's Q2 2025 exceeded expectations, with hotel and travel demand maintaining prosperity and driving GMV to positive year-over-year growth. Stable industry competition patterns and improved marketing subsidy efficiency continue driving steady core OTA profit margin improvements. Considering the company's growth potential and performance elasticity compared to TRIP.COM-S's scale, a target price of HK$27.88 is assigned. The company also received the highest ESG rating of AAA from international authority MSCI, ranking in the global top 5%.
Other industry chain segments also present attractive opportunities, such as hotel leader H World, which achieved high-quality scale growth in the first half with double-digit revenue growth in both quarters. As of June 2025, hotel numbers and total operating rooms both grew over 18%. The company achieved multiple breakthroughs in product and ecosystem development, launching the "epoch-making" Hanting 4.0, with Orange becoming the second growth curve in the mid-scale segment.
In conclusion, driven by policy, consumption structure, and AI across multiple dimensions, the tourism industry fundamentals are approaching a new inflection point. Industry recovery acceleration generates three major structural changes while AI applications create new sectors, continuously revitalizing industry chain vitality and expanding market scale. This year's Mid-Autumn and National Day overlap brings highly certain demand opportunities for the industry chain, creating investment opportunities for the sector. Focus should be placed on segment leaders such as TRIP.COM-S and TONGCHENGTRAVEL in the OTA space.