Hong Kong could benefit from a looming price war between mainland travel agencies running tours to the SAR. On Tuesday, China International Travel Services Guangzhou cut prices for Hong Kong-Macau tours by 40 per cent. Hong Kong Association of Registered Tours Co-ordinator chairman Wong Wai-wing expected other mainland operators would follow suit as fewer people were travelling after the Lunar New Year holiday. A quota system, which restricted the daily number of mainland visitors to 1,500, was scrapped on January 1. At the same time, the number of operators allowed to offer organised tours to Hong Kong was increased from four to all 67 outbound agencies. DBS Vickers Securities analyst Perry Tsea expects China Travel Service - the mainland's largest operator - to cut tour prices 20 per cent, following an average 20 per cent reduction last year. But China Travel said there were no immediate plans to review prices for its Hong Kong-Macau package tours. Cheaper trips could benefit Hong Kong. More attractive tour packages would bring in more mainland tourists, leading to a boost in spending. Mr Wong said profit margins of Hong Kong's inbound tour agencies were already being squeezed. 'They have to take it, even if it is no profit at all,' he said.