Sinolink: Supply deepens the release of demand, cultural and tourism events open up growth space.

Sinolink published a research report stating that with the deepening of the supply side of service consumption, residents' consumption demand is expected to be further released, with cultural and tourism events being the most typical track. The Supe model has confirmed the commercial value of cultural and tourism events, with new events such as Feichao, Horse Racing, and the World Cup expected to replicate the successful experience of the Supe model, driving the benefits of related sports and cultural and tourism assets. Reviewing the historical stock performance of Supe and the World Cup, it is recommended to pay attention to sports and cultural and tourism companies with excellent event IP operation capabilities, abundant sports venues and equipment resources, and full industry chain integration capabilities. Sinolink's main points are as follows: The importance of service consumption is highlighted, and policies are shifting from short-term stimulus to institutional restructuring. The multiplier effect of service consumption is strong, with the contribution rate to economic growth consistently higher than that of physical consumption, highlighting its importance. China's consumption policy is shifting from subsidy-dependent short-term stimulus to institutional restructuring, releasing residents' demand for service consumption through increased income plans, supply innovation, and governance reform, providing a friendly development environment for cultural and tourism events. From top-down to bottom-up on the supply side, unleashing the vitality of cultural and tourism events. Traditional sports events in China are scarce, rooted in complex approvals, low securitization of cultural and sports assets, and severe homogenization of events. According to the National Bureau of Statistics, the total output of sports competitions and performances in China in 2024 was only 78.6 billion yuan, accounting for 2.0% of the total sports output. Cultural and tourism events represented by Supe have used a three-element synergy model of "government-market-society" to enhance operational efficiency and release the vitality of cultural and tourism consumption, breaking through the supply bottleneck of high-quality cultural and tourism events. According to the goal set by the State Council for the total scale of the sports industry to exceed 7 trillion yuan by 2030, with the proportion of sports competition and performance output at 2%, the scale is expected to reach 140 billion yuan by 2030; with the gradual release of high-quality event supply, if aligned with the level of 8% in developed countries as suggested by China Finance Magazine, the scale is expected to reach 560 billion yuan. The Supe model drives phenomenal traffic, with abundant commercialization space. Driven by four factors: social psychology, cultural core, economic drive, and governance security, Supe has ignited phenomenal traffic. In terms of direct income, according to the accumulated audience of 2.433 million and an average ticket price of 10 yuan for Supe, ticket revenue is approximately 24.33 million yuan. Estimating total sponsorship revenue based on different sponsorship fee levels, total estimated sponsorship revenue is approximately over 60 million yuan. In terms of driving effects on cultural and tourism, Supe events have driven cross-regional cultural and tourism consumption of 14.57 billion yuan; excluding hotel and inter-province transportation consumption of out-of-town tourists, the bank estimates that local per capita consumption accounts for 30-50% of out-of-town tourists, estimating that under neutral conditions, Supe drives total local and out-of-town cultural and tourism consumption to nearly 19 billion yuan. With Feichao, horse racing, and the World Cup events approaching, new growth spaces are expected. 1) Feichao is linked to the dual trends of low-altitude and silver-haired economy, with a large base of elderly population in Jiangsu, high participation in sports events, and high elasticity in travel consumption. Compared with the average tourist spending of over 1,000 yuan at Supe, at three levels of 500, 1,000, and 1,500 yuan per capita cultural and tourism consumption, with 20,000 participants and 100,000 spectators, Feichao is expected to bring total cultural and tourism consumption to the level of 100-200 million yuan. 2) High-quality horse racing events are scarce in China, with the Guangzhou horse racing event having scarce international qualifications and institutional barriers, potentially accurately covering a high-net-worth audience. Based on an estimated 9,500 audience at the Tianhe Racecourse, if the average cultural and tourism consumption reaches 2,000 yuan per person, it would drive 19 million yuan in total cultural and tourism consumption; if the average cultural and tourism consumption reaches 6,000 yuan per person, it is expected to drive 57 million yuan in total cultural and tourism consumption. 3) The World Cup, as a top global IP, is expected to drive demand in multiple areas such as lottery, venues, sports equipment, etc. Risk warning Risk of macroeconomic volatility, risk of policy progress below expectations, and risk of consumer preferences.