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Strictly Private & Confidential
ASEAN Tourism
- Invest ASEAN SG, 27-28 March 2018
Analyst
Sittichai Duangrattanachaya
(662) 658 1300 ext. 1393
Samuel Yin Shao Yang
(603) 2297 8916
Strictly Private & Confidential Page 1
The size of tourism industry in ASEAN
1) International tourist arrivals - % of total 2) % of whole economy GDP
3) % of whole economy employment4) % of contribution in ASEAN
10yr CAGR (2005-2016)
Northern EU 2.7%
Western EU 2.3%
Central/Eastern EU 2.6%
Southern/Medit EU 3.5%
North East Asia 5.5%
South East Asia 7.9%
Oceania 3.3%
South Asia 10.7%
North America 3.4%
Caribbean 2.7%
Central America 5.0%
South America 5.4%
Africa 4.7%
Middle East 4.3%
Source: UNWTO, WTTC, Respective countries
Strictly Private & Confidential Page 2
Tourist Arrival Breakdown
1) Top 10 tourist groups 2) Tourism contribution - ASEAN
3) Chinese contribution 4) Intra-ASEAN tourism
Source: UNWTO, WTTC, Respective countries
Strictly Private & Confidential Page 3
Overcrowding risk
Source: WTTC
Strictly Private & Confidential Page 4
T&T infrastructure scores and ranks
Source: World Economic Forum, WTTC, Oxford Economics
Note: Green signifies strong performance and red signifies weak performance
Strictly Private & Confidential Page 5
Travel and tourism investment
1) ASEAN T&T investment and demand 2) Share of T&T infrastructure spending
3) Global hotel transaction volumes 4) Composition of capital for hotel acquisition
Source: WTTC, JLL
Strictly Private & Confidential Page 6
Hotel room supply (as of Feb 2018)
Rooms under construction and planning Hotel supply development - % of supply
%Chg MoM %Chg YoY %Chg MoM %Chg YoY %Chg MoM %Chg YoY %Chg MoM %Chg YoY
China 0.5% 8.6% 8.7% 13.4% 6.5% 26.1% -6.5% 3.5%
Indonesia 0.4% 3.2% 6.5% -56.7% 4.2% -2.2% -6.4% -13.2%
Thailand 1.9% 8.9% 0.1% 42.5% 17.9% 43.7% -10.4% 8.6%
Malaysia 1.5% 4.3% -7.8% -19.8% 1.7% 11.2% -3.3% -17.8%
Singapore 0.0% 5.5% 0.0% 25.3% 0.0% -80.0% 0.0% -29.1%
Vietnam 4.5% 19.3% 31.4% 103.6% 17.5% 103.5% -4.7% -8.9%
Philippines 1.0% 14.8% 0.0% 61.6% 0.0% 20.5% -2.1% -3.3%
Japan 0.0% 3.5% 3.7% -0.8% 77.3% 96.9% -26.7% 24.9%
Australia 0.2% 6.9% 1.0% -2.9% 10.8% 30.0% -4.5% 58.1%
India 0.4% 4.4% 6.4% 14.9% 2.3% -15.2% -2.6% -4.0%
South Korea -0.2% 13.3% 1.6% 150.5% 10.1% -32.7% -6.7% -10.6%
Taiwan 0.0% 1.3% -15.7% -10.2% -6.3% -33.9% 6.4% 48.8%
New Zealand 0.0% 2.0% 0.0% -7.6% 21.3% 193.5% -1.2% 22.1%
Maldives 0.9% 10.7% 44.4% 156.6% -2.7% 77.0% 10.8% -22.6%
Existing supply Recently opened Under construction In planning
Source: CBRE, HVS, JLL, STR Global
Strictly Private & Confidential Page 7
SWOT for ASEAN as a destinationStrength Weakness
Steady tourism growth outlook Lack of a strong tourism cooperative
Intra-regional visa formalities Large disparity between destinations' level of quality
Short flight times for intra-regional travel Less attention to tourism yield and quality
Strong socio-economic development Duplication product offering and marketing campaigns
Good MICE facilities The one visia policy has still not been implemented
Diversified tourism experiences Poor infrastructure in some countries
Poor intra-country transport options
Insufficient human resource development
Opportunities Threats
Capitalizing on the emerging markets Safety and security issues
Higher interest in new destinations Political instability
Expansion of low cost carriers Currency fluctuations
Improved connectivity throughout ASEAN Overcrowding and insufficient skilled workers
Single source market dominance
Infrastructure, future investment and D/S balance
Source: Maybank Kim Eng, Respective countries
Strictly Private & Confidential
Thailand – Looking for sustainable growth
- Invest ASEAN SG, 27-28 March 2018
Analyst
Sittichai Duangrattanachaya | +662 658 5000 ext 1393| [email protected]
Strictly Private & Confidential Page 9
Thailand tourism outlook
1) Tourist arrival 2) Average daily spending by items
3) No -ve impacts from THB appreciation
- Tourist arrivals are expected to rise
further to reach 37-38m in 2018, boosted
by political stability and aggressive
marketing campaigns.
- Spending on shopping and F&B have been
rising in the past three years.
- We see limited impacts from THB
appreciation on both tourist traffics and
spending.
Source: Tourism Authority of Thailand, Ministry of Tourism and Sports
Strictly Private & Confidential Page 10
Tourist’s spending behavior (2013-2016)
1) ASEAN 2) Chinese
3) European 4) Indian
Source: Tourism Authority of Thailand, MKE-ISR
Strictly Private & Confidential Page 11
Government’s tourism policies and campaigns
1) Quality tourist 2) Secondary cities
3) Potential market 4) The Riviera Thailand project
Source: Tourism Authority of Thailand, Ministry of Tourism and Sports
Strictly Private & Confidential Page 12
Infrastructure development plan
- With >3 million tourists in the country every
month, safety and raising the standard of land
and sea transport was a priority.
- To boost tourism growth, Thailand would require
improvements to infrastructure to support 50m
tourists a year.
Source: Ministry of Transport, Royal Thai Government
Strictly Private & Confidential Page 13
Airport development plan
Source: Airports of Thailand, Civil Aviation Authority of Thailand
AOT's airport development plan 2017 2021 2022 2025 2026 2030
Phuket Airport
Capacity 6.5m -> 12.5m 12.5m -> 18m 18m -> 25m
Investment 5,790 2,700 12,000
Hat Yai Airport
Capacity 2.5m -> 6m 6m -> 10m
Investment 9,500 5,600
Chiang Mai Airport
Capacity 8m -> 18m 18m -> 20m
Investment 9,200 1,800
Chiang Rai Airport
Capacity 3m -> 3.3m 3.3m -> 3.7m 3.6m -> 4m
Investment 3,700 600 1,900
Suvarnabhumi Airport
Capacity 45m -> 90m 90m -> 105m 105m -> 120m
Investment 59,000 na na
Don Mueang Airport
Capacity 30m -> 40m
Investment 32,000
Total pax throughput capacity 92 137 155 197 212 246
Total investment 5,790 62,700 2,700 63,300 na 9,300
DOA's airport development plan
Regional airport development (Mae Sot / Bae Tong / Sakon Nakhon / Krabi) with total invesmtnet of THB7,260m
Develop Khon Kaen Passenger terminal - Total investment THB2,145m
Airports’ utilisation rate
Airports’ capacity expansion vs traffics
Strictly Private & Confidential Page 14
Secondary city airports’ traffic flow
South Northeast North Central & West
Feb-18 2M18 Feb-18 2M18 Feb-18 2M18 Feb-18 2M18
Chumphon 3.0% 1.4% Loei -5.8% -7.2% Mae Hong Sorn -5.5% -9.9% Phitsanulok 29.6% 30.6%
Ranong 53.5% 30.0% Udon Thani -4.1% -6.5% Lampang 4.7% 3.3% Tak (Mae Sot) 20.3% 21.8%
Surat Thani -2.7% -8.2% Nakhon Phanom 5.8% 5.8% Phrae 4.9% 5.1% Bangkok (Don Mueang) 9.5% 8.5%
Nakhon Si Thammarat -2.0% 11.0% Sakon Nakhon 4.0% 0.4% Nan -1.8% -2.8% Bangkok (Suvarnabhumi) 5.3% 4.7%
Krabi 1.8% -3.8% Khon Kaen 4.8% -3.4% Chiang Mai 9.1% 7.6%
Trang -7.6% -0.4% Roi Et 25.7% 21.6% Chiang Rai 15.4% 13.9%
Narathiwat -17.2% -25.1% Ubon Ratchathani 9.2% 7.3%
Phuket 22.8% 16.9% Buriram 34.2% 31.9%
Songkhla (Hat Yai) -2.1% -4.5%
Total 12.4% 8.0% Total 3.9% 0.5% Total 9.7% 8.2% Total 7.0% 6.2%
AOT's airports 18.3% 12.9% AOT's airports na na AOT's airports 10.3% 8.7% AOT's airports 6.9% 6.1%
DOA's airports -0.1% -2.9% DOA's airports 3.9% 0.5% DOA's airports 0.8% -0.6% DOA's airports 27.0% 28.3%
Under AOT management
%Chg YoY %Chg YoY %Chg YoY%Chg YoY
Under DOA management
Source: Airports of Thailand, Civil Aviation Authority of Thailand
Strictly Private & Confidential Page 15
Hotel projects in pipeline for FY18-20Operators Details Rooms Targeting destinations Opening timeline
Carlton Hotel Bought 2.5 rai of land with the unfinished hotel structure that has a valid construction permit 342 Bangkok 2019
ONYX Plans to open a new 406-room OZO Hotel with total investment of THB3.4b / Plans to open 255-rooms OZO 661 Pattaya, Phuket 2019
Marriott Plans to open 17 hotels in Thailand through various brands, mostly in luxury segment na Thailand 2018-2021
Cachet JV with local partners to develop or operate more than 40 properties including 463-rooms in Bangkok 463 Thailand 2019
Movenpick Plans to operate four hotels include Movenpick Asara Hua Hin (96 rooms), Movenpick Khao Yai (62 rooms), Phuke, Pattaya 358 Thailand 2018-2019
Expect to achieve deals for five hotels in Bangkok, Chiang Mai and Pattaya na Thailand 2019
Holiday Inn Plans to spend THB3b expanding its hospitality business in Eastern region, Rayong in particular 300 Thailand 2019
Best Western Plans to open a 270-room hotel at Bangkok's Don Mueang International Airport 270 Bangkok 4Q2019
Aiming to open at least 16 hotels in Thailand by 2020 / Signed management contracts for eight hotels (1,566 rooms) 270 Thailand 2018-2020
- Vib Sanampao (89 rooms) 89 Bangkok 3Q 2018
- Best Western Plus Beach Front (216 rooms) 216 Phuket 3Q 2018
- Best Western Prime Square (48 rooms) 48 Chiang Mai 1Q 2019
- Best Western Premier Bayphere (174 rooms) 174 Pattaya 2019
- Best Western Chatuchak (168 rooms) 168 Bangkok 1Q 2020
- BluPhere Pattaya, BW Premier Collection (199 rooms) 199 Pattaya 1Q 2020
- Best Western Premier Himalai (402 rooms) 402 Phuket 4Q 2020
Hyatt Scheduled to open 273-rooms hotel / Eyeing Rayong, Pattaya and Koh Samui for its next locations 273 Bangkok 3Q 2018
Miners Hospitality Devloping the Rizin Hotel and Residence Pattaya 160 Pattaya 2018
Travelodge Planning for 50 properties or 10,000 rooms in Thailand na Thailand 2020
Prince Plans to make inroads into Thailand by managing hotel in Prechuap Khiri Khan 255 Thailand 2020
Hilton Plans to introduce a new brand ' Hilton Garden Inn' to Thailand at Phuket (177 rooms) 177 Phuket 2020
Plans to open Waldorf Astoria Bangkok (170 rooms) and second DoubleTree in Phloenchit area (251 rooms) 421 Bangkok 2H18
Dusit Invested THB1.4b to develop hotel in Philippines under "D2" / Room could quadruple to >2,000 rooms in 3-years 1,500 Philippines 2H18
CENTEL Plans to open two COSI hotels in 2018-2019 / Set to open one hotel in Dubai (600 rooms) and two hotels in Maldives (300 rooms) 1,182 Thailand, Maldives, Dubai 2019-2020
Signed a management agreement to operate 12 hotels in many contries (857 rooms in Thailand) 2,698 Asia, Middle East 2018-2020
MINT Set an investment of THB3.4b to develop six hotels in Thailand and overseas (India, Vietnam, Malaysia, Indonesia, Tanzania) 9,847 Global 2020
ERW Plans to open six hotels in Thailans (4 Hop Inn, ibis, Novotel) and three Hop Inn hotels in Philippines 1,157 Thailand and Philippines 2018
Plans to open Mercure & ibis Sukhumvit 24, Hop Inn in Thailand and Philippines 1,515 Thailand and Philippines 2019-2020
SHRREIT Plans to raise THB8.05b to invest in five foreign five-stars hotels (946 rooms) in Vietnam, Cambodia and Indonesia 946 ASEAN 2018
Apex Plans to spend THB6.25b to develop three hotesl in Phuket (333 rooms) and one hotel in Pattaya (246 rooms) 579 Thailand 2019-2020
Approved a four-year investment plan worth THB23b to develop hotel and mixed use in Phuket and Krabi (THB3.8b) na Phuket, Krabi 2018-2021
Urban Plans to build a new city hotel worth THB400m in Bangkok's prime Sukhumvit area (120 rooms) 120 Bangkok mid-2019
Plans to build a new hotel worth THB1b on Chao Phraya River (250 rooms) / Eyeing three projects in Bangkok 250 Bangkok 2H19
UGH Set to open a mid-scale hotel worth THB500m in Bangkok's Silom (150 rooms) 150 Bangkok 3Q 2019
Plaza Athenee Rebranding and upgrading to a higher position as The Athenee Hotel, "a Luxury Collection Hotel" with total investment of THB1b na Bangkok 2018
Singha Set budget THB51b on a project in the Maldives consisting of hotels, duty-free shops, convention hall na Maldives 2018-2022
Novotel Investing THB360m for a big renovation ar Novotel Suvarnabhumi na Bangkok 2019
Origin Property JV with InterContinential Hotels Group to develop three hotels with total investment of THB7.5b 900 Bangkok, Chonburi 2021
Sansiri Set to expand its Escape Hotel chain over the next 3-5 years, with two properties in Hua Hin and Khao Yai 500 Chiang Mai, Phuket, Pattaya 2020-2022
Grande Centre Point Plans to open at least one hotel per year, targeting major cities. In 2018, One hotel in Bangkok will be opended 450 Thailand 2018-2020
Sala Hospitality Second phase of Sala samui Chaweng is expected to be completed in early 2019 (83 rooms) 83 Soh Samui 2019
Absolute Hotel Services Signed a management agreement to open U North Pattaya in 2020 (270 rooms) 270 Pattaya 2020
Total rooms in Thailand 11,596
Strictly Private & Confidential Page 16
Demand and Supply dynamics in Thailand
1) OCC, ADR, Tourist arrivals 2) Existing supply and recently opened
3) Rooms in the pipeline 4) Conversion rate of room under construction
Source: CBRE, HVS, JLL, STR Global
Strictly Private & Confidential Page 17
Thailand tourism related companies – Peer valuation summary
Source: Maybank Kim Eng
Price TP Rating ROE (%) Price chg
22-Mar THB FY18E FY19E FY18E FY19E FY18E FY19E FY18E FY19E FY18E FY19E FY18E YTD (%)
Aviation
Airports of Thailand 68.0 60.0 HOLD 38.2 34.6 6.6 6.0 14.9 13.7 22% 11% 1.3% 1.5% 18.1% 0%
Asia Aviation 5.35 5.7 HOLD 15.2 13.7 1.1 1.1 8.9 9.0 15% -5% 2.7% 2.6% 7.2% -13%
Bangkok Airways 14.7 27.0 BUY 54.9 36.6 1.0 1.0 12.6 10.9 na 50% 2.1% 2.5% 2.3% -15%
Thai Airways 15.8 12.0 SELL 15.0 10.8 1.0 1.0 7.0 6.8 321% 39% 0.7% 0.8% 7.8% -9%
Hotel
Central Plaza Hotel 47.0 60.0 BUY 27.1 24.1 4.8 4.2 13.5 12.4 8.8% 12.4% 1.5% 1.7% 18.3% -21%
Erawan Group 7.8 9.0 BUY 33.0 28.1 3.4 3.2 13.7 12.3 16.4% 17.4% 1.2% 1.4% 10.8% -11%
Minor International 37.8 45.0 HOLD 26.7 23.6 3.3 3.0 16.9 15.5 15.5% 13.3% 1.2% 1.4% 13.2% -14%
Healthcare
Bangkok Dusit 22.6 20.0 HOLD 38.5 34.5 5.2 4.9 23.3 21.2 14.5% 11.6% 1.4% 1.5% 13.9% 8%
Bumrungrad 207.0 230.0 BUY 36.9 34.0 8.1 7.2 22.8 20.8 23.3% 8.5% 1.4% 1.5% 24.2% 9%
Bangkok Chains 16.7 17.0 BUY 39.0 33.8 7.2 6.4 19.8 17.8 15.7% 15.3% 1.5% 1.6% 18.8% 2%
Siam Wellness 18.7 15.7 HOLD 40.9 30.6 11.9 9.5 25.8 20.0 48.5% 33.4% 1.0% 1.4% 30.3% -9%
Beauty Community 21.6 24.2 BUY 40.0 31.7 34.2 29.8 30.5 24.1 29.8% 25.9% 2.3% 2.9% 67.7% 2%
Platinum 8.4 8.7 HOLD 29.0 21.2 2.6 2.5 13.8 10.2 9.6% 36.6% 2.2% 2.9% 9.2% 3%
DDD 100 125 BUY 51.2 39.2 36.4 27.9 34.4 26.2 na 30.7% 1.3% 1.7% 42.9% 10%
Others* (Based on consensus estimates)
P/E (X) EPS growth (%) Dividend yield (%)P/B (X) EV/EBITDA (X)
Strictly Private & Confidential
Malaysia – Towards Visit Malaysia Year 2020
- Invest ASEAN SG, 27-28 March 2018
Analyst
Samuel Yin Shao Yang | +603 2297 8916 | [email protected]
Strictly Private & Confidential Page 19
Colours of Malaysia
Strictly Private & Confidential Page 20
Tourism industry a major contributor to the Malaysian economy
Gross Value Added Of Tourism Industry (GVATI) Total visitor arrivals to MY (‘000)
Breakdown of tourist spending (% share of GVATI) Tourism receipts earned in MY (MYRb)
25,948
-
5,000
10,000
15,000
20,000
25,000
30,000
35,000
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
-
10.0
20.0
30.0
40.0
50.0
60.0
70.0
80.0
90.0
100.0
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
Source: Department Of Statistics, Tourism Malaysia
Strictly Private & Confidential Page 21
2017 was a year of consolidation after a resurgent 2016
Total visitor arrivals to MY – eased in 2H17 SG visitor arrivals to MY – weighed by recovering MYR
CN visitor arrivals to MY- weighed by regional competition 2017 total visitor arrivals to MY breakdown by nationality
-25.0%
-20.0%
-15.0%
-10.0%
-5.0%
0.0%
5.0%
10.0%
15.0%
20.0%
25.0%
-
500.0
1,000.0
1,500.0
2,000.0
2,500.0
3,000.0
Jan-1
0
Jun-1
0
Nov-1
0
Apr-
11
Sep-1
1
Feb-1
2
Jul-
12
Dec-1
2
May-1
3
Oct-
13
Mar-
14
Aug-1
4
Jan-1
5
Jun-1
5
Nov-1
5
Apr-
16
Sep-1
6
Feb-1
7
Jul-
17
Dec-1
7
Total visitor arrivals ('000) Total visitor arrivals chg YoY
-40.0%
-20.0%
0.0%
20.0%
40.0%
60.0%
80.0%
-
50.0
100.0
150.0
200.0
250.0
Jan-1
0
Jun-1
0
Nov-1
0
Apr-
11
Sep-1
1
Feb-1
2
Jul-
12
Dec-1
2
May-1
3
Oct-
13
Mar-
14
Aug-1
4
Jan-1
5
Jun-1
5
Nov-1
5
Apr-
16
Sep-1
6
Feb-1
7
Jul-
17
Dec-1
7
Chinese visitor arrivals ('000) Chinese visitor arrivals chg YoY
-30.0%
-20.0%
-10.0%
0.0%
10.0%
20.0%
30.0%
-
200.0
400.0
600.0
800.0
1,000.0
1,200.0
1,400.0
1,600.0
1,800.0
Jan-1
0
Jun-1
0
Nov-1
0
Apr-
11
Sep-1
1
Feb-1
2
Jul-
12
Dec-1
2
May-1
3
Oct-
13
Mar-
14
Aug-1
4
Jan-1
5
Jun-1
5
Nov-1
5
Apr-
16
Sep-1
6
Feb-1
7
Jul-
17
Dec-1
7
Singapore visitor arrivals ('000) Singapore visitor arrivals chg YoY
Singapore48%
Indonesia11%
China9%
Brunei6%
Thailand7%
Japan2%
United Kingdom1%
Others16%
Source: Tourism Malaysia
2017: -3%2017: -6%
2017: +7%
Strictly Private & Confidential Page 22
Tourism receipts still flat and on-the-ground spending still growing strongly
Tourism receipts earned in MY (MYRb) – still flat YoY Foreign credit card purchases in MY chg YoY – still strong
Average tourism receipts by nationality (MYR) Malaysia My Second Home participants – More CN migrants
Country 2013 2014 2015 2016 8M17 Total
China 1,337 1,307 719 1,512 1,439 9,902
Japan 739 428 300 281 179 4,372
Bangladesh 285 250 205 283 253 3,746
United Kingdom 148 117 83 110 113 2,499
Iran 51 17 19 8 18 1,351
Singapore 145 94 67 93 60 1,346
Taiwan 151 83 71 77 80 1,271
Korea 98 137 120 184 278 1,514
Pakistan 58 51 31 29 25 992
India 41 42 46 68 53 937
Others 622 548 550 702 586 7,891
Total 3,675 3,074 2,211 3,347 3,084 35,821
-
10.0
20.0
30.0
40.0
50.0
60.0
70.0
80.0
90.0
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2,970 3,033
3,968
2,249 2,262
-
500
1,000
1,500
2,000
2,500
3,000
3,500
4,000
4,500
Singapore Indonesia China Brunei Thailand
-30.0
-20.0
-10.0
0.0
10.0
20.0
30.0
40.0
Dec-1
3
Feb-1
4
Apr-
14
Jun-1
4
Aug-1
4
Oct-
14
Dec-1
4
Feb-1
5
Apr-
15
Jun-1
5
Aug-1
5
Oct-
15
Dec-1
5
Feb-1
6
Apr-
16
Jun-1
6
Aug-1
6
Oct-
16
Dec-1
6
Feb-1
7
Apr-
17
Jun-1
7
Aug-1
7
Oct-
17
Dec-1
7
UnionPay &
AliPay not
included
Source: Tourism Malaysia, Bank Negara Malaysia, Ministry of Tourism & Culture
CN visitors spend
more than a third
more than others
Strictly Private & Confidential Page 23
0.0%
5.0%
10.0%
15.0%
20.0%
25.0%
30.0%
35.0%
-
2.0
4.0
6.0
8.0
10.0
12.0
14.0
16.0
18.0
20.0
2010 2011 2012 2013 2014 2015 2016
Domestic (m) (LHS) Foreign (m) (LHS) Foreign as % of total (RHS)
45% of CN
visitors to
MY visit
Melaka
Sabah and Melaka are the shining stars
Total visitor arrivals to Sabah – still growing YoY CN visitor arrivals to Sabah – drawn by nature
Visitor arrivals to & tourism receipts in Melaka – still up YoY Total visitor arrivals to Melaka breakdown – increasingly foreign
-20.0%
-15.0%
-10.0%
-5.0%
0.0%
5.0%
10.0%
15.0%
20.0%
25.0%
30.0%
-
50,000
100,000
150,000
200,000
250,000
300,000
350,000
400,000
Jan-1
3
Apr-
13
Jul-
13
Oct-
13
Jan-1
4
Apr-
14
Jul-
14
Oct-
14
Jan-1
5
Apr-
15
Jul-
15
Oct-
15
Jan-1
6
Apr-
16
Jul-
16
Oct-
16
Jan-1
7
Apr-
17
Jul-
17
Oct-
17
Jan-1
8
Malaysia (LHS) International (LHS) Total chg YoY (RHS)
-80.0%
-60.0%
-40.0%
-20.0%
0.0%
20.0%
40.0%
60.0%
80.0%
100.0%
120.0%
140.0%
-
10,000
20,000
30,000
40,000
50,000
60,000
Jan-1
3
Apr-
13
Jul-
13
Oct-
13
Jan-1
4
Apr-
14
Jul-
14
Oct-
14
Jan-1
5
Apr-
15
Jul-
15
Oct-
15
Jan-1
6
Apr-
16
Jul-
16
Oct-
16
Jan-1
7
Apr-
17
Jul-
17
Oct-
17
Jan-1
8
China (LHS) China chg YoY (RHS)
2017: +15%
-
2,000
4,000
6,000
8,000
10,000
12,000
14,000
16,000
18,000
20,000
-
2.0
4.0
6.0
8.0
10.0
12.0
14.0
16.0
18.0
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
Tourist arrivals (m) (LHS) Tourism receipts (m) (RHS)
20% of CN
visitors to
MY visit
Sabah
25% of all
visitors to
MY visit
Melaka
Source: Sabah Tourism Board, Melaka Tourism Promotion Division
2017 visitor arrivals: +3%
2017 local: +7%
2017 foreign: +9%
Strictly Private & Confidential Page 24
Optimistic about Visit Malaysia Year 2020
History is on the side of optimism
• 2017 total visitor arrivals (-3% YoY) was weighed down
by:-
Recovering MYR against other ASEAN currencies,
especially the SGD
Regional competition from other ASEAN countries,
especially TH, SG and ID
Less promotion and development (P&D) budget due
to low oil prices
• VMY 2014 P&D budget was MYR358m. VMY 2020 P&D
budget is MYR500m and may get another MYR300m.
• Historically, total visitor arrivals and tourism receipts
ramp up BEFORE VMY (i.e. 2006 and 2013).
• Judging from history, 2019 and 2020 ought to be positive
for the tourism industry.
• Historically, total visitor arrivals and tourism receipts
structurally upgrade AFTER VMY.
• Key attractions that are expected to be completed soon
are:-
Encore Melaka - Impression Series (2Q18/3Q18) –
first outside China
20th Century Fox World (4Q18/1Q19) – first Fox
theme park in the world
• Expect inter-state rivalry as state governments will
receive half of tourism tax (MYR10 per night).
Total visitor arrivals to MY (‘000)
Tourism receipts earned in MY (MYRb)
-
5,000
10,000
15,000
20,000
25,000
30,000
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
-
10.0
20.0
30.0
40.0
50.0
60.0
70.0
80.0
90.0
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
36m visitor arrivals & MYR168b tourism receipts
Source: Tourism Malaysia
2006: +7%, 2007: +20%
2013: +3%, 2014: +7%
2006: +14%, 2007: +27%
2013: +8%, 2014: +10%
Strictly Private & Confidential Page 25
Rapid infrastructure development to drive tourism industry growth
Bukit Kayu Hitam CIQ
- 300km railway line
- Songkhla-Penang
Swettenham Pier Cruise Terminal
- Penang Port-Royal Carribean JV
- 480m to 700m berth expansion
Encore Melaka (2Q18)
- Impression Series from China
- 2,007 rotating seats theatre
East Coast Rail Link (2024)
- >22 stations along >600km
- Port Klang to Thai border
KL-SG High Speed Rail (2026)
- 8 stations along 350km
- 1 station in Melaka
20th Century Fox World (4Q18)
- First in the world
- 25 rides over 25 acres
Tok
Bali
3-4m
visitors
p.a.
3m tickets
sold pre-
opening
2017:
438k pax
up 140%
KL-SG in
90
minutes
772 acres
develop-
able
Source: The Sun Daily, The Independent, Penang Port, Yong Tai, Genting Malaysia, Land Public Transport Commission, MyHSR Corporation
Strictly Private & Confidential Page 26
Malaysian tourism related companies – Peer valuation summary
CP TP Rating EPS (sen) P/E (X) EPS growth (%) Dividend yield (%) P/BV (x) Price chg
16 Mar MYR CY18E CY19E CY18E CY19E CY18E CY19E CY18E CY18E CY18E YTD (%)
Aviation
AirAsia 4.15 3.81 Hold 38.0 39.8 10.9 10.4 (10.4) 4.7 2.2 17.3 1.9 23.9
AirAsia X 0.41 0.39 Hold 3.2 4.8 12.8 8.5 52.4 50.0 0.0 11.8 1.5 24.2
MAHB 8.85 8.11 Sell 26.3 30.6 33.7 28.9 182.8 16.3 1.0 4.7 1.6 0.7
Gaming
Genting 8.95 12.75 Buy 56.2 68.5 15.9 13.1 1.4 21.9 2.0 7.0 0.9 (2.7)
Genting Malaysia 5.24 5.35 Hold 32.6 43.7 16.1 12.0 31.5 34.0 2.3 9.1 1.4 (6.9)
Others
Atlan 4.48 6.00 Buy 16.0 16.5 28.0 27.1 3.2 3.1 3.8 12.5 3.5 4.4
Yong Tai 1.50 1.75 Buy 10.9 18.8 13.8 8.0 153.5 72.0 0.0 12.5 1.1 (1.3)
REITs
Al-Salam 0.91 1.00 Hold 6.2 6.3 14.6 14.4 1.6 1.6 5.9 5.8 0.8 (9.5)
CMMT 1.00 1.15 Buy 7.5 7.5 13.3 13.3 (3.8) 0.0 7.1 5.7 0.8 (45.4)
IGB 1.50 1.85 Buy 8.7 9.0 17.2 16.7 0.0 3.4 5.9 8.2 1.4 (16.7)
KLCC Property 7.60 8.00 Hold 40.6 41.8 18.7 18.2 1.8 3.0 4.4 5.4 1.0 (12.0)
Pavilion 1.40 1.60 Hold 7.6 8.3 18.4 16.9 (1.3) 9.2 5.3 5.7 1.1 (13.0)
Sunway 1.67 1.85 Buy 10.0 10.4 16.7 16.1 4.7 3.5 5.4 7.1 1.2 (12.1)
YTL Hospitality 1.10 1.40 Buy 8.3 9.0 13.3 12.3 5.1 8.5 6.9 5.7 0.8 (14.1)
Source: Maybank Kim Eng
Strictly Private & Confidential Page 27
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