The sluggish stock price of Tuniu has recently seen a significant rise.
At the close of March 13th Eastern Time, online travel company Tuniu Travel Network (NASDAQ: TOUR) recorded $0.828 per share, up 16.46%, and rose over 20% during trading, marking the highest stock price since the beginning of this year.
On that day, Tuniu released its unaudited fourth quarter and fiscal year 2023 performance reports as of December 31, 2023. In 2023, Tuniu recorded a net income of 441 million yuan, a year-on-year increase of 140.3%; The gross profit was 293.7 million yuan, a year-on-year increase of 27.9%. In addition, non US accounting standards recorded a net profit of 50.8 million yuan, a new high since listing, and also the first time this indicator has achieved profitability since the pandemic.
In addition, Tuniu recorded a net loss attributable to common shareholders of 99.3 million yuan, which has not yet truly turned losses into profits. However, the year-on-year loss narrowed by nearly 48% compared to 2022, making it the year with the smallest loss since its listing.
In the tourism boom of 2023, Tuniu is reversing its decline.
Package tourism revenue recovery
Many listed travel companies have seen a turning point in their performance in 2023, with multiple companies doubling their revenue and turning losses into profits.
Previously, OTA leader Ctrip Travel was the first to release its 2023 full year performance, achieving a net operating income of 44.5 billion yuan, a year-on-year increase of 122%, and a net profit of 10 billion yuan, a year-on-year increase of over 614%.
According to Tuniu's latest disclosed performance, the significant increase in net revenue in 2023 was mainly due to the recovery of revenue from packaged tourism products. This business recorded 333.4 million yuan, a year-on-year increase of 374%, accounting for about 75% of total revenue. In the financial report conference call, the management of Tuniu pointed out that this growth is mainly due to the recovery of the tourism market driving the growth of travel groups.
The income of Tuniu is mainly divided into two parts, namely packaged tourism product income and other income. Packaged tourism product income accounts for more than 80% of Tuniu's income in the long term, and more than 60% of it is from outbound tourism products.
In the years affected by the epidemic, the main business sector has been greatly impacted, and the proportion of revenue has decreased. At the same time, the proportion of revenue from businesses such as insurance company service fees, travel product and service commissions (ticket, visa service fees, accommodation reservations, and transportation tickets) has increased.
It is worth mentioning that the founder of Tuniu, Yu Dunde, once publicly commented on the layout of a certain OTA platform, including airfare, hotels, tickets, outbound travel, etc., saying that it "has everything but not everything is perfect." Nowadays, Tuniu is also adding alcohol products in addition to packaged travel. In 2023, the transaction volume of Tuniu's self operated air ticket business increased by 89% year-on-year, and the transaction volume of self operated hotel business increased by over 600% year-on-year.
Another growth point of Tuniu in recent years has come from live streaming. In order to cope with the impact of the epidemic, Tuniu began to try to carry goods live from April 2020. Unlike other tourism platforms, Tuniu put its main battlefield in Tiktok, and incubated several accounts such as "Follow Tuniu to Hainan" and "Small players in East China".
According to Tuniu, in the second quarter of 2023, Tuniu's live streaming business achieved its first quarterly profit since its launch. In 2023, the total amount of Tuniu live broadcast transactions will exceed 1 billion yuan, and the incubated Tuniu small players will take the lead in the MCN institutions of the Tiktok life service platform.
At present, the live streaming accounts of @ East China Little Players and @ Jiangsu Zhejiang Shanghai Surrounding Tours are the main accounts of Tuniu, both achieving transaction volumes exceeding 100 million yuan in the summer of 2023. On March 14th, when Time Finance checked, both of the above accounts were conducting daily live streaming sales. On the national group buying sales weekly list, @ East China Little Player ranked 17th on the overall list and 6th on the travel list, with a sales volume of 1.202 million yuan. @ Jiangsu Zhejiang Shanghai peripheral tourism ranked 19th on the travel list, with a sales volume of 926000 yuan.
Times Finance has noticed that some of Tuniu's cultural and tourism accounts have more sales than New Oriental Cultural and Tourism, a subsidiary of Dongfang Zhenxuan. From March 11th to present, @ Jiangsu, Zhejiang, and Shanghai peripheral tourism ranks 19th in terms of domestic tourism sales volume, while @ New Oriental Culture and Tourism ranks 62nd.
Tuniu and Dongfang Zhenxuan have also collaborated before. On February 2, 2023, both parties collaborated to launch the live broadcast of "Tuniu x Oriental Selection Watch the World Yunnan Special Session". During the financial report conference call, the management mentioned the live streaming business and stated that they will try to expand to more platforms in the future, such as Xiaohongshu and Dongfang Zhenxuan.
The market is divided by competitors
Driven by favorable performance, Tuniu's stock price surged by 16% on March 14th, but still far from its peak.
After four months of listing in August 2014, Tuniu's stock price reached $24.99 per share, with a market value of over $3.076 billion (approximately RMB 21.7 billion). But thereafter, Tuniu's stock price fluctuated and fell, and due to the stock price being below $1 for a long time, it received several delisting warning letters issued by NASDAQ.
Since 2024, the stock price of Tuniu has not yet exceeded $1 per share. At the close of March 14th, Tuniu's stock price was $0.828, leaving a market value of only $103 million. Compared to the highest point, the stock price of Tuniu has dropped by 96.7% in 8 years, and its market value has evaporated by over 2.973 billion US dollars (approximately 21.3 billion RMB).
Tuniu's market share is also being divided among its competitors.
According to the quarterly monitoring report on China's online vacation tourism market released by Analysys Think Tank in the fourth quarter of 2015, Tuniu's transaction volume in the fourth quarter of 2015 was 3.4 billion yuan, and its market share increased to 26.2%. But after 2019, changes in travel habits and the rise of personalized tourism have gradually left Tuniu, which focuses on group tours, behind, and its market share has been surpassed by a group of peers.
According to the report released by BOCOM International, it is predicted that Ctrip, Tongcheng, Meituan and Feizhu will respectively occupy 57%, 13%, 15% and 6% of the market shares in 2023, while Tiktok will further rise to 4%, while Tuniu is not listed separately.
Although Tuniu has hit the hot spot in live streaming, the categories of products sold in Tuniu's live streaming rooms are not limited to liquor and tourism products.
Taking @ East China Little Player, who has the highest transaction volume, as an example, this account's daily sales products are daily necessities and snacks. As of March 14th, the best-selling product in the store is a paper drawing with sales exceeding 5 million pieces.
JD Returns as a Shareholder
As Tuniu's performance improves, the capital group behind it also welcomes an old man. In February of this year, Tuniu announced that Chen Jie had resigned from his position as a member of the board of directors and the compensation committee of Tuniu Company. At the same time, Zhang Rui had been appointed as a member of the board of directors and the compensation committee. The above adjustments took effect on February 29, 2024.
Among them, Chen Jie is the chairman of another travel company * ST Caesar, while the newly recruited Zhang Rui comes from the JD brand. Since taking over its stake in Tuniu from JD.com in 2020, Caesar has been the second largest shareholder of Tuniu with a 21.1% stake. At that time, Caesar stated that it would further mobilize the advantageous resources of the three parties, strengthen the linkage between online and offline business, and actively engage in business collaboration with Tuniu.
In December 2023, JD, Caesar, and Tuniu signed a termination agreement, in which Caesar Group returned over 78 million shares of Tuniu shares held by JD, accounting for 21.0% of Tuniu's issued ordinary shares.
This board member adjustment is also a personnel rotation after the equity transfer and division.
For the withdrawing party Caesar, in the past few years, it has experienced losses, been "ST", and its main business of outbound tourism has been greatly affected, indicating that it has become somewhat difficult to protect itself. "Caesar's previous layout at Tuniu must have had long-term thinking about capitalization, but due to the impact of the epidemic and the unsuccessful business transformation in the past two years, it is also necessary to reduce business scale and eliminate long-term investment backdrops." Hu Xiaoying, General Manager of Ke Errui Culture and Tourism, pointed out.
For JD.com, which is returning to Tuniu Capital, its purpose may not be just financial investment.
JD.com first invested in Tuniu in 2014, with a total investment of over 600 million US dollars. But with the decline in Tuniu's stock price, JD.com transferred its shares to Caesar in 2020. And this time, taking over again, the personnel stationed on the board of directors have changed from the former Vice President responsible for 3C business to the head of tourism business.
According to Tuniu, Zhang Rui joined JD in 2023 and is currently responsible for JD's lifestyle and travel business department, with over 25 years of experience in the tourism industry. Before joining JD.com, Zhang Rui had worked in Meituan's overseas business department, Alibaba's travel and leisure tourism department, and China Tourism Group's outbound tourism department.
With regard to the return of JD, Hu Xiaoying believes that the Internet giants are now adding to the cultural and tourism track, and JD's entry is not surprising, but she believes that JD started late and has always been conservative in its new business layout.
Has Tuniu's situation been reversed as performance rebounds and shareholders reshuffle?