EQUITY RESEARCH: SHANGHAI JIN JIANG INTERNATIONAL HOTELS

As one of the largest hotel groups in China, Jin Jiang Hotels operates in 58 countries or regions around the world, with over 13,000 hotels and 1.2 million guest rooms. It has a complete brand matrix including full-service, limited-service and catering services. Jin Jiang Hotel has been committed to digital upgrading, integrating the traffic ecosystem, enhancing user stickiness, and has acquired companies such as the French Louvre Group to complete its high-end brand layout. It has also taken the lead in ESG policies. This research report conducts an in-depth valuation analysis of Jin Jiang Hotel. Mainly using the WACC valuation model, the target share price for 2026 is determined to be ¥ 26.95. Compared with ¥ 22.41 on June 3, 2025, the annualized return rate is 9.84%, with the upside potential of 15.13%, and the risk rating is medium risk. Based on its strategic position as the leading player in China's hotel industry, the resilience of post-pandemic recovery and the potential for digital transformation, a "buy" recommendation is issued to Jin Jiang Hotels. In addition, this report uses the FCFE model, the APV model, and the relative valuation model to conduct supplementary comparisons of valuation predictions. However, risks still exist. This report conducts a risk analysis of Jin Jiang Hotel from aspects such as operational risks, market risks, regulatory risks, and financial risks. It also specifically performs sensitivity analysis and Monte Carlo simulation on occupancy rates and rental cost rates to observe the direct impact of these two variables on the company's profitability.