China Merchants Securities (CMSC) released a research report indicating that domestic tourism revenue and visitor numbers during the Spring Festival period recorded significant growth, reaching historic highs. While the growth rate for inbound and outbound travel was slightly below the overall market average, it still showed a modest increase compared to previous years, with overall tourism data exceeding expectations.

During the 2026 Spring Festival holiday, boosted by the extended break that concentrated leisure travel demand, the hotel industry demonstrated clear growth in both volume and price. Off-island duty-free consumption showed strong vitality. Although outbound travel growth lagged behind the domestic market, it still improved compared to the previous year. Tourist traffic in higher-tier cities and popular travel destinations continued steady growth, with mountain resorts and performance attractions repeatedly setting new records. County-level tourism experienced explosive growth.

Within the tourism industry chain, CMSC recommends focusing on hotels driven by leisure demand, regional scenic spots benefiting from improved external transportation and internal optimization, and online travel agencies (OTAs) closely correlated with outbound travel and passenger numbers. The main views of China Merchants Securities are as follows:

**Overall Situation** Both domestic tourism trips and revenue hit record highs, with overall performance surpassing expectations. During this year's Spring Festival holiday (February 15 to February 23, totaling 9 days), domestic tourist trips nationwide reached 596 million, an increase of 19.0% year-on-year. Average daily tourist trips were approximately 66.22 million, up 5.8% year-on-year. Average daily domestic tourism revenue was 89.28 billion yuan, a rise of 5.5% year-on-year. Per capita tourism spending was 1,348 yuan, down 0.2% year-on-year. Inbound and outbound tourist trips totaled approximately 17.996 million, with a daily average of 197,700, a year-on-year increase of 10.1%, slightly below the expected growth rate of 14.1%.

In summary, domestic revenue and visitor numbers maintained an upward trend during the Spring Festival. Benefiting from the extended holiday, both overall domestic tourist trips and revenue achieved double-digit growth. While the growth rate for cross-border travel was lower than the domestic market, it still showed a clear increase compared to previous years, with the overall tourism data performing better than the bank's expectations.

**Transportation Situation** Passenger traffic volume increased by 10.5% year-on-year, with civil aviation and railway passenger volumes growing by approximately 8.2% and 13.0% respectively. During the 2026 Spring Festival holiday (February 17 to February 23, the first to the seventh day of the lunar new year), cross-regional passenger traffic volume reached about 2.323 billion person-trips, an increase of roughly 10.5% compared to the same period in the previous lunar new year, and up about 32.6% compared to the same period in 2019. Specifically, railway passenger trips were 99.378 million (+13.0%); waterway passenger trips were 11.042 million (+25.0%); civil aviation passenger trips were 17.762 million (+8.2%); and highway passenger traffic was 2.195 billion person-trips (+9.5%).

**Hainan Duty-Free** Off-island duty-free sales in Hainan during the first four days of the Spring Festival holiday increased by 21% year-on-year, with shopper numbers up 26%. During the 2026 Spring Festival holiday (February 17 to 22, the first to the sixth day of the lunar new year), Haikou Meilan International Airport handled 4,021 flight movements and transported 673,706 passengers. Compared to the same period in 2025 (4,063 flights and 633,584 passengers), flight volume decreased slightly by 1.0%, while passenger throughput increased by 6.3%, indicating a significant rise in travel demand and seat occupancy rates despite a largely stable flight schedule.

The 2026 Spring Festival consumption vitality was prominent. In the first four days, total shopping value in Hainan's off-island duty-free market reached 1.03 billion yuan, with 137,000 shoppers, representing year-on-year growth of 20.9% and 25.7%, respectively. Haikou's performance was steady; as of February 21 (the fifth day of the lunar new year), the cumulative seven-day off-island duty-free sales reached 882 million yuan, an increase of 8.6% year-on-year.

Risk warnings include potential economic and consumption downturn risks, and risks associated with changes in travel policies.