Shaanxi Tourism - State-owned Assets Empowerment + Quality Operations, Building a Leading High-Profit Cultural and Tourism Enterprise

Research Report Selection

Shaanxi Tourism relies on the core tourism resources of Huoqing Palace and Mount Huashan. Backed by the Shaanxi provincial state-owned assets, its tourism performances and cable car operations are steady, with superior profitability. The company’s IPO-raised and investment projects are expected to land in an orderly manner, which could further boost earnings and unlock room for growth. This is the first coverage.

Backed by the Shaanxi State-owned Assets Supervision and Administration Commission, the company has high-quality and abundant cultural and tourism resources. The company integrates performance, cable cars, and tourism catering businesses. Relying on scarce high-quality tourism resources such as Huoqing Palace and Mount Huashan, it develops a high-quality destination combining scenic areas and cultural tourism. Backed by the Shaanxi Provincial SASAC, it benefits from empowerment of cultural and tourism resources from state-owned assets and the controlling shareholder. After the pandemic, the company seized market opportunities to expand capacity; its core business rapidly recovered. In 2023, revenue and earnings reached 1.7 and 2.9 times those of 2019, respectively. In 2025, it was briefly impacted by abnormal weather. From 2025Q1 to Q3, the company’s revenue was 8.89 billion yuan, down 18.80% year over year; net profit attributable to shareholders was 3.69 billion yuan, down 26.93% year over year.

Cultural and tourism travel sentiment is high, and the cable car performance commercial model is superior. In recent years, favorable policy support for cultural and tourism travel and service consumption has been rolling out frequently. The domestic cultural and tourism market has been relatively strong, with Shaanxi Province performing even more robustly. Inbound tourism has also seen notable highlights, which may contribute new growth drivers. In the scenic area business, the cable car business shows a clear “cash cow” characteristic, with high operating leverage. The rigidity in ridership leads to substantial profitability; for most listed companies, the cable car segment’s gross margin can be as high as 80%. The performance business’s overall market growth has been steady, and the industry landscape is relatively stable. Profits of leading projects are strong, but industry performance is differentiated, and operational capability has become the key to winning.

A dual-engine drive of performances and cable cars; the raised investment projects are expected to unlock room for growth. Performances and cable car businesses are the main contributors to revenue and earnings. 1) Performances: the benchmark IP “Song of Everlasting Regret” remains evergreen, and the performance product matrix continues to expand. “Song of Everlasting Regret” is the company’s flagship performance project, contributing over 90% of revenue from the performance business. Leveraging advantages in positioning, refined operations, and rental cost advantages, the auditorium occupancy rate has remained above 80% for a long time, and its gross margin is also above 80%. Other performance projects have smaller revenue scale; “12.12” has been growing rapidly, while “The Flames of Mount Tai” is still in its ramp-up phase. 2) Cable cars: the Mount Huashan West Peak cable car is the pillar project, with both ridership rate and passenger flow increasing. Mount Huashan’s climbing difficulty is high, and the ridership rate of the West Peak cable car has continued to exceed 100% in recent years, contributing more than 80% of revenue and gross profit from the cable car passenger transportation business. Less Hua Shan Aojigou cable car, the Huawei slide, and the Wengyu road projects are smaller in scale, but their profitability remains attractive. 3) Raised investment projects: the company’s raised investment projects focus on the performance and cable car core businesses, including equity asset acquisition and supply-upgrade construction projects. They are expected to further optimize business layout, enhance carrying capacity, open up long-term growth potential, and boost the company’s performance.

Valuation

Relying on the core tourism resources of Huoqing Palace and Mount Huashan, backed by the Shaanxi Provincial State-owned Assets Supervision and Administration Commission, the company’s performance and cable car businesses are steady in operation and have superior profitability. Its IPO-raised investment projects are expected to be implemented in an orderly manner, which may further boost earnings and open up room for growth. Earnings forecast and valuation—click below to jump to the research report details.

Main risks facing the rating

Risk of macroeconomic fluctuations, project implementation progress not meeting expectations, and extreme weather impacting operations.

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