Deep-dive 2021-17: TravelSky
TravelSky Technology (696 HK) is a Chinese travel technology company owned by state holding company SASAC and the Chinese airlines.
The company provides a booking and inventory management system for airlines - a so-called Global Distribution System (GDS). This system connects airlines with travel agents, enabling airlines to offer their airline seats to customers on a single platform, updated in real-time.
You can look at TravelSky as a virtual “toll booth” on air travel in China: a monopoly taking a cut of all air ticket reservations, leading to stable, recurring revenue in a growing market.
The worldwide GDS market is dominated by three firms: Sabre in the United States, Amadeus in Europe and to a lesser extent Travelport. TravelSky, on the other hand, dominates the Chinese market where it has a virtual monopoly.
TravelSky is also engaged in a number of other businesses. These include departure control systems, flight connecting services, baggage handling systems, automatic check-in…