Summary
China is now the largest outbound tourist market and growing at more than 18% per annum.
What sectors are set to benefit the most from this growth including hotels, airlines, travel companies and retail stocks..
We list some potential investable ideas as well as some strategies to use.
We discuss the potential for MAR, PCLN, CTRP, HLT, H, HOT, IHG, SIX, FUN, PEJ..
China has problems and bigger opportunities.
As we've discussed before to hear most foreign news media reporting, China's economy is about to collapse. Perhaps for the commodities sector it is. But keep in mind everything is big and so are the opportunities. In the move to consumption from investment what opportunities is that creating? Growth trends aren't exactly a dime-a-dozen in the markets right now. Ripples amongst Chinese hundreds of millions of newly middle class consumers are creating waves of opportunities, but what are they and how can average investors take advantage of them?
Tourism - Today Hong Kong, tomorrow the World
Anyone who has lived in China can tell you one truth of traveling, "Never visit a Chinese tourist during a Chinese holiday". The crush of people will overwhelm even those who like a crowd. With tourist numbers growing by 19.5% in 2015 over 2014 Chinese holidays are going to become better known around the world.
This trend is just starting.
As fast as it has been growing, keep in mind that still just 6% of Chinese have passports (around 84 million people).Further, most that do travel stick to only Hong Kong and Macau. Border crossings jumped from 83 million to about 133 million according to a COTRI estimate in 2015 1. Despite the larger number of Americans with passports Chinese tourists outpaced Americans. They collectively spent nearly $200 billion abroad last year - almost double what the 2nd placed Americans spend.
200 Million Visitors by 2020
That's today. What about when 12% or even 20% of Chinese have passports and are willing to venture beyond greater China? By comparison about 130 million Americans or roughly 46% have passports. The Chinese government itself expects that 200 million visitors per year will venture overseas by 2020.
So where are they going to go?
Read the rest of this report on Seeking Alpha here.
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