Shares of Fosun Tourism Group surged in Hong Kong on Friday following the company's announcement of a projected profit turnaround for the first half of the year. The stock rose by up to 13% and was last trading at HK$8.68, marking a 10% increase.
Fosun Tourism, a leading Chinese hotel operator and tourism services provider, revealed on Thursday its expectation of returning to profitability in the January-June period after experiencing losses in the previous year. The company attributed this significant shift in earnings to the surge in holiday demand that occurred once China resumed domestic tourism after lifting Covid restrictions in late 2022.
The positive outlook for China's tourism industry has further bolstered investor confidence. Analysts are anticipating an acceleration in travel recovery during the third quarter, with an increase in long-haul leisure travel demand expected during the summer school break. Additionally, the upcoming Golden Week National Day holiday is set to drive sector sentiment, according to a note by Citi analysts.
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