China Tourism Group Duty Free Corp. Shares May Turn Around

Key Points:

• CTG Duty Free's mainland-listed shares have fallen 25% this year, while its Hong Kong-listed stock has dropped about 39% from a February high.
• The company's final full-year earnings, to be reported later on Monday, may offer clearer signals on the pace of a recovery.
• The outlook for CTG Duty Free is increasingly tied to a rebound in its Hainan business, which generates more than 50% of revenue.

Business Performance:

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• Recent policy support and improving travel flows have begun to lift sales in Hainan.
• Investors are now looking to earnings and management guidance for confirmation that demand is stabilizing and that the recovery can be sustained in the months ahead.

Industry Outlook:

• CSC International Holdings analyst Doris Gu expects the "worst for CTG Duty Free is over" and that the recovery trend is becoming clearer.
• Citigroup Inc. expects an earnings rebound in 2026, driven by a positive catalyst in Hainan duty-free sales.
• Morgan Stanley analysts, including Hildy Ling, expect Hainan duty-free sales to grow 25-30% for full-year 2026.

Financial Performance:

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• China Duty Free Group reported preliminary FY net income of 3.59 billion yuan.