"More Tourists Flocking to Korea Again"... Foreign Visitors Rush to Jeju and Casinos [Practical Investment]

Inbound Tourism Surges, Domestic Consumer Sentiment Rebounds
Travel and Casino Stocks Benefit
Spotlight on Beneficiaries Like Hana Tour and Lotte Tour Development

"A lot of people are visiting our country these days."

Jeju Airport is bustling with tourists and other arrivals on the 30th, one day before the extended holiday weekend. Yonhap News

This is the most notable sentence from SK Securities' May report. The number stands at a staggering 1.67 million?the number of foreign visitors to South Korea in March. This figure marks a new monthly record since the COVID-19 pandemic. The expansion of Incheon International Airport, the increase in air routes, and the overlapping holiday periods in major countries such as Japan and China have all contributed to a strong rebound in the domestic tourism industry.

The number of foreign tourists visiting Jeju Island is also recovering rapidly. As of last month, the number of foreign arrivals to Jeju reached 193,000, approaching the post-pandemic peak of 212,000 recorded in August last year. In addition, with the arrival of large cruise ships beginning in earnest this month, there is a high possibility that the number of foreign arrivals will once again reach a new high. Na Seungdoo, a researcher at SK Securities, analyzed, "It is now time to raise expectations to the level of 2016, just before the THAAD deployment, rather than simply focusing on the post-COVID-19 period."

The increase in foreign tourists is also bringing a positive impact to the casino industry. In particular, Lotte Tour Development's Jeju Dream Tower is at the center of this rebound, driven by the growing influx of foreign visitors. Lotte Tour Development operates both a foreigner-only casino and a hotel at Jeju Dream Tower. The company is now seen as having entered a virtuous cycle, with rising demand not only for the casino but also for hotel and leisure services.

In the first quarter of this year, the number of casino visitors at Lotte Tour Development reached approximately 110,000, a 38.3% increase compared to the same period last year. The drop amount (the total value of chips purchased by casino guests) also rose by 25.3% to 481.9 billion won. This is the second-highest level since August last year.

Lee Hyunji, a researcher at Eugene Investment & Securities, noted, "It is noteworthy that the number of Chinese visitors is increasing even during the off-season," and predicted, "Since Chinese nationals can already enter Jeju Island visa-free, and visa-free entry to all of Korea is expected to be allowed in the third quarter of this year, the number of Chinese tourists will increase further, leading to growth in casino sales."

Not only is the number of foreign tourists rising, but domestic consumer sentiment is also showing signs of recovery. According to the "April 2025 Consumer Sentiment Survey Results" released by the Bank of Korea, the Consumer Composite Sentiment Index (CCSI) for this month stood at 93.8, up 0.4 points from the previous month. Consumer sentiment, which had plummeted to 88.2 in December last year due to the 12·3 emergency martial law incident, is gradually recovering amid growing policy expectations ahead of the early presidential election.

Yonhap News

In particular, expectations for spending on travel and entertainment/cultural activities are showing a clear recovery trend, returning to pre-pandemic levels. In contrast, expectations for spending on medical and educational expenses have declined slightly, indicating a relative strengthening of consumer preference for travel and entertainment.

In fact, while the number of outbound travelers has decreased somewhat since the holiday effect in January this year, it continues to show steady growth compared to the same period last year. Notably, the share of travelers to Southeast Asia is decreasing, while the number of travelers to Japan and China has increased significantly.

In the first quarter of this year, the number of Koreans visiting China increased by 48.8% compared to the same period last year. Travel to Japan also rose by 6.7%, maintaining its steady popularity. In contrast, travel to Southeast Asian countries such as Thailand (-11.1%) and the Philippines (-8.9%) declined. This is interpreted as being due to concerns over public safety and a lack of diversity in travel content.

As a result, prospects for major travel agencies are also positive. Despite sluggish performance in the first quarter, Hana Tour is seeking a rebound on the back of expectations for golden holidays in the second half of the year and a recovery in domestic demand. Hana Tour recorded consolidated sales of 168.4 billion won and operating profit of 12.3 billion won in the first quarter. While results met market expectations (consensus), both the number of customers sent abroad and the average selling price (ASP) declined, leading to weaker performance. However, positive momentum continues in the Chinese market, with the number of customers sent to China increasing by 61% year-on-year. This is attributed to visa exemptions and the revitalization of exchanges between the two countries, and the trend of mid- to long-term demand improvement is expected to continue.

Lee Kihun, a researcher at Hana Securities, analyzed, "Unless additional negative factors arise, Hana Tour's performance is likely to rebound from the second quarter of this year," and added, "Since the share price has already reflected major concerns, there is growing anticipation that the upward trend will resume in the second half of the year after a short-term adjustment."

Modetour is also expected to see its share price trend upward, supported by the 'holiday effect' and increased demand for overseas package tours. In addition, the completion of the fourth phase of Incheon Airport's expansion at the end of last year has led to an increase in the number of foreign airlines operating in Korea, resulting in greater airline seat supply and a favorable environment for the industry.

Yoo Seongman, a researcher at Leading Investment & Securities, said, "Since Modetour has already undergone significant adjustments due to various negative factors, its downside risk is now limited, and it is expected to enter a recovery phase in the second half of this year." He also noted, "The exchange rate is likely to fluctuate within a predictable range this year, so concerns over foreign exchange losses are also minimal."