Stock Connect Concept Tracking | State Council Announces 2 Extra Holidays in 2025, Institutions Bullish on Travel Chain Valuation Increase (including Concept Stocks)

The State Council issued a decision to amend the "National Holidays and Commemorative Days Holiday Regulations," which will take effect on January 1, 2025. The decision consists of two articles and mainly stipulates the following: First, all citizens will have two additional holidays, namely Lunar New Year's Eve and May 2nd. After the increase, the Spring Festival holiday will be 4 days long, and Labor Day holiday will be 2 days long. Second, for all citizens' holidays, reasonable arrangements for unified holidays and rest days can be made, combined with the implementation of paid annual leave system, to create longer holiday periods in practice. Except for certain special circumstances, the number of consecutive working days before and after statutory holidays generally does not exceed 6 days. Sinolink research report indicates that the addition of 2 days to holidays in 2025 will benefit the travel chain sector. It is recommended to layout the travel chain sector. Due to the capacity constraints of aircraft manufacturers and upstream component suppliers, the growth rate of aircraft numbers in the future aviation industry will slow down. If demand improves, supply-demand optimization will drive price increases. In addition, the marketization of ticket prices will release the profit elasticity of airlines, with the aviation sector having a high beta, significant excess returns in a bull market, and a focus on the three major airlines in the Hong Kong stock market with relatively low valuations. Related Hong Kong stocks in the travel industry chain include: Civil aviation-related companies such as: Air China Limited (00753), China Eastern Airlines (00670), China Southern Airlines (01055), etc. Tourism and hotel-related industry companies such as: TRIP.COM-S (09961), TONGCHENGTRAVEL (00780), FOSUN TOURISM (01992), HWORLD-S (01179), etc.