reports
- Greater China Research Team
- Johnny Yum
- Kitpon Praipaisarnkit
- Malaysia Research Team
- Singapore Research Team
- Thailand Research Team
- Vincent Khoo Boo Aik
REG: Strategy: Alpha Picks - April 2024
GREATER CHINA Strategy Alpha Picks: April Conviction Calls: Adding AIA, Midea, Hansoh Pharmaceutical, Shenzhen Inovance and Trip.com to our BUY list, with SELL calls on BYD, EVE Energy, and Li Auto. INDONESIA Strategy Alpha Picks: Outperformance In Mar 24 and 1Q24: Our picks are ACES, BBTN, CMRY, SIDO, EXCL, MAPI, JSMR, CTRA, and AKRA. MALAYSIA Strategy Alpha Picks: Expanding The Variety Of Events Bets: Our Alpha Picks trounced the KLCI in Mar 24. Apr 24 picks: GENM, Inari, Mah Sing, MrDIY, MY...
TFG THAIFOODS GROUP
AS7 ANTA SPORTS PRODUCTS LTD.
300014 EVE ENERGY CO. LTD. CLASS A
A117ME ALIBABA GROUP HOLDING LTD. SPONSORED ADR
GRU GEELY AUTOMOBILE HOLDINGS LIMITED
KKP KIATNAKIN BANK
00016 SUN HUNG KAI PROPERTIES LIMITED
00992 LENOVO GROUP LIMITED
CPF CHAROEN POKPHAND FOODS PUBLIC CO. LTD.
ES ESSO SOCIETE ANONYME FRANCAISE
AKRA PT AKR CORPORINDO TBK
01109 CHINA RESOURCES LAND LIMITED
00388 HONG KONG EXCHANGES & CLEARING LTD.
CTRA CIPUTRA DEVELOPMENT
STEC SINO-THAI ENGINEERING & CONSTRUCTION PCL
02328 PICC PROPERTY & CASUALTY CO. LTD. CLASS H
600809 SHANXI XINGHUACUN FEN WINE FACTORY CO. LTD. CLASS A
V03 VENTURE CORPORATION LIMITED
ERW ERAWAN GROUP
TOP THAI OIL PUBLIC CO. LTD.
U96 SEMBCORP INDUSTRIES LTD.
SXC SUNNY OPTICAL TECHNOLOGY (GROUP) CO. LTD.
JSMR PT JASA MARGA (PERSERO) TBK CLASS B
002594 BYD COMPANY LIMITED CLASS A
01299 AIA GROUP LIMITED
KLBF PT KALBE FARMA TBK
EA ENERGY ABSOLUTE PUBLIC CO. LTD.
TU THAI UNION GROUP PUBLIC COMPANY LIMITED
COM7 COM7
ADVANC ADVANCED INFO SERVICE PUBLIC CO. LTD.
600585 ANHUI CONCH CEMENT COMPANY LIMITED CLASS A
00027 GALAXY ENTERTAINMENT GROUP LIMITED
C52 COMFORTDELGRO CORPORATION LIMITED
BMRI PT BANK MANDIRI (PERSERO) TBK
ORI1 ORIENT OVERSEAS (INTERNATIONAL) LIMITED
MINT MINOR INTERNATIONAL PUBLIC CO. LTD.
Z74 SINGAPORE TELECOMMUNICATIONS LIMITED
MAPI MITRA ADIPERKASA
O39 OVERSEA-CHINESE BANKING CORPORATION LIMITED
AP4 RIVERSTONE HOLDINGS
ADRO PT ADARO ENERGY TBK
300124 SHENZHEN INOVANCE TECHNOLOGY CO. LTD CLASS A
601888 CHINA TOURISM GROUP DUTY FREE CORPORATION LIMITED CLASS A
PTTGC PTT GLOBAL CHEMICAL PUBLIC COMPANY LTD
ACES PT ACE HARDWARE INDONESIA TBK
TLKM PT TELKOM INDONESIA (PERSERO) TBK CLASS B
ROTI NIPPON INDOSARI CORPINDO
M4B CHINA MERCHANTS BANK CO. LTD. CLASS H
SE SEA ADS
INRI INARI AMERTRON BHD
PTTEP-R PTT EXPLORATION & PRODUCTION PCL NVDR
BAL BUMITAMA AGRI LTD
SCGB SUNWAY CONSTRUCTION GROUP BH
KPJ KPJ HEALTHCARE BERHAD
SMM SEMBCORP MARINE LTD
BURSA BURSA MALAYSIA BHD
MSGB MAH SING GROUP BHD
IOI IOI CORP BHD
CPALL TB CP ALL
GENM GENTING MALAYSIA BHD
MAHB MALAYSIA AIRPORTS HLDGS BHD
333 MIDEA GROUP
06098 COUNTRY GARDEN SERVICES HOLDINGS CO. LTD.
01801 INNOVENT BIOLOGICS INC.
2013 WEIMOB INC
EKO EKOVEST BHD
RGB RGB INTERNATIONAL BHD
SCB-R SIAM COMMERCIAL BANK PCL NVDR
709 GIORDANO INTERNATIONAL LTD
1093 CSPC PHARMACEUTICAL GROUP LTD
FRKN FRENCKEN GROUP LTD
MPM MARCO POLO MARINE LTD
MRDIY MR DIY GROUP M BHD
09988 ALIBABA GROUP HOLDING LTD.
09999 NETEASE INC
2696 SHANGHAI HENLIUS BIOTECH INC
KEX KERRY EXPRESS (THAILAND)
OR PTT OIL & RETAIL BUSINESS PCL
TIDLOR NGERN TID LOR PCL
1209 CHINA RESOURCES MIXC LIFESTYLE SERVICES
3692 HANSOH PHARMACEUTICAL GROUP
BUKA BUKALAPAK.COM PT TBK
PDD PINDUODUO PDD US
09888 BAIDU INC
BBTN BANK TABUNGAN NEGARA PERSERO TBK PT
BBNI BANK NEGARA INDONESIA PERSER
EXCL XL AXIATA TBK PT
GOTO GOJEK TOKOPEDIA TBK PT
CMRY PT CISARUA MOUNTAIN DAIRY TBK
CLAS CAPITALAND ASCOTT TRUST
SMGR SEMEN INDONESIA PERSERO TBK
NATGATE NATIONGATE HOLDINGS BHD
NCKL PT TRIMEGAH BANGUN PERSADA TBK (HARITA NICKEL)
SUNWAY SUNWAY BHD
ESSO ESSO THAILAND PCL
HUME HUME CEMENT INDUSTRIES BHD
02015 LI AUTO INC
09961 CTRIP.COM INTERNATIONAL
BTG BETAGRO PUBLIC COMPANY LIMITED
- Kenny Yong Hui Lim
China Construction Bank (939 HK): 2023: Results in line; expect revenu...
CCB’s 2023 net profit came in largely within our expectation with 2.4% yoy growth. 4Q23 earnings inched up 0.3% yoy on better cost control and lower provisions despite the revenue dip. We expect the bank to face continued revenue headwinds in 2024 given the challenging environment. We cut our earnings forecasts on lower NIM assumptions and reduce our target price to HK$6.00. Maintain BUY.
- Jo Yee Ng
- Johnny Yum Chung Man
- Kate Luang
- Kenny Yong Hui Lim
- Roy Chen Chengzhi
- Shirley Wang Xueyi
- Stella Guo Yuting
Greater China Daily: Wednesday, April 3, 2024
KEY HIGHLIGHTS Strategy Small-Mid Cap Biweekly Eyeing re-rating for refrigerant suppliers as AC dealers front-load for peak sales in 2Q24. Results China Construction Bank (939 HK/BUY/HK$4.85/Target: HK$6.00) 2023: Results in line; expect revenue headwinds to persist in 2024. COSCO SHIPPING Holdings (1919 HK/BUY/HK$8.44/Target: HK$10.60) 2023: Results in line; expect an upbeat 1H24 performance. Maintain BUY. Kweichow Moutai (600519 CH/BUY/Rmb1,713.99/Target: Rmb2,488.00) 2023: Earnings up ...
- Jack Goh Tooan Orng
- Jo Yee Ng
- Johnny Yum
- Johnny Yum Chung Man
- Kate Luang
- Kenny Yong Hui Lim
- Kong Ho Meng
- Malaysia Research Team
- Roy Chen Chengzhi
- Shirley Wang Xueyi
- Singapore Research Team
- Stella Guo Yuting
- Stevanus Juanda
- Tanaporn Visaruthaphong
- Vincent Khoo Boo Aik
Regional Morning Meeting Notes: Wednesday, April 03, 2024
GREATER CHINA Strategy Small-Mid Cap Biweekly Eyeing re-rating for refrigerant suppliers as AC dealers front-load for peak sales in 2Q24. Results China Construction Bank (939 HK/BUY/HK$4.85/Target: HK$6.00) 2023: Results in line; expect revenue headwinds to persist in 2024. COSCO SHIPPING Holdings (1919 HK/BUY/HK$8.44/Target: HK$10.60) 2023: Results in line; expect an upbeat 1H24 performance. Maintain BUY. Kweichow Moutai (600519 CH/BUY/Rmb1,713.99/Target: Rmb2,488.00) 2023: Earnings up ...
- Kenny Yong Hui Lim
China Merchants Bank (3968 HK): 2023: Rise to the occasion.
CMB’s 2023 results are in line with its preliminary results. 4Q23 earnings beat on cost control, lower provisions and trading gains. Management indicated that they will maintain the dividend payout after lifting it to 35%. They also guided that it will be challenging for CMB to achieve positive earnings growth in 1Q24 amid the margin squeeze and tepid fee income. Maintain BUY. Target price: HK$44.00.
- Bella Lu Yifei
- Carol Dou Xiao Qin
- Damon Shen
- Greater China Research Team
- Jieqi Liu
- Jo Yee Ng
- Ken Lee
- Kenny Yong Hui Lim
- Shirley Wang Xueyi
- Stella Guo Yuting
- Sunny Chen
Greater China Daily: Thursday, March 28, 2024
KEY HIGHLIGHTS Results BYD Company (1211 HK/SELL/HK$201.60/Target: HK$140.00) 4Q23: Earnings up 19% yoy but down 17% qoq, in line. Management guides for flat earnings in 2024. Maintain SELL. Target price: HK$140.00. China Mengniu Dairy (2319 HK/BUY/HK$17.08/Target: HK$22.50) 2023: Missed estimates on one-off loss; weak demand to persist in the near term. China Merchants Bank (3968 HK/BUY/HK$30.95/Target: HK$44.00) 2023: Rise to the occasion. Country Garden Services (6098 HK/HOLD/HK$5.27...
02328 PICC PROPERTY & CASUALTY CO. LTD. CLASS H
EZQ CHINA MENGNIU DAIRY CO. LTD.
M3I MINTH GROUP LIMITED
000333 MIDEA GROUP CO. LTD. CLASS A
M4B CHINA MERCHANTS BANK CO. LTD. CLASS H
1211 BYD COMPANY LIMITED CLASS H
06862 HAIDILAO INTERNATIONAL HOLDING LTD.
3933 THE UNITED LABORATORIES INTE
333 MIDEA GROUP
06098 COUNTRY GARDEN SERVICES HOLDINGS CO. LTD.
6049 POLY PROPERTY SERVICES CO LTD
2269 WUXI BIOLOGICS (CAYMAN) INC.
- Bella Lu Yifei
- Carol Dou Xiao Qin
- Damon Shen
- Heidi Mo Jinghui
- Jieqi Liu
- Jo Yee Ng
- Ken Lee
- Kenny Yong Hui Lim
- Llelleythan Tan Tan
- Shirley Wang Xueyi
- Stella Guo Yuting
- Stevanus Juanda
- Sunny Chen
- Tanaporn Visaruthaphong
Regional Morning Notes - Thursday, March 28, 2024
GREATER CHINA Results BYD Company (1211 HK/SELL/HK$201.60/Target: HK$140.00): 4Q23: Earnings up 19% yoy but down 17% qoq, in line. Management guides for flat earnings in 2024. Maintain SELL. Target price: HK$140.00. China Merchants Bank (3968 HK/BUY/HK$30.95/Target: HK$44.00): 2023: Rise to the occasion. Haidilao International Holding (6862 HK/BUY/HK$16.86/Target: HK$18.80): 2023: In line; revenue growth on higher table turnover in 2024. Midea Group (000333 CH/BUY/Rmb63.67 /Target: Rmb76.20): 20...
02328 PICC PROPERTY & CASUALTY CO. LTD. CLASS H
C52 COMFORTDELGRO CORPORATION LIMITED
M3I MINTH GROUP LIMITED
000333 MIDEA GROUP CO. LTD. CLASS A
M4B CHINA MERCHANTS BANK CO. LTD. CLASS H
1211 BYD COMPANY LIMITED CLASS H
06862 HAIDILAO INTERNATIONAL HOLDING LTD.
3933 THE UNITED LABORATORIES INTE
ICBP INDOFOOD CBP SUKSES MAKMUR T
TTB TMBTHANACHART BANK PCL
BUKA BUKALAPAK.COM PT TBK
- Greater China Research Team
- Johnny Yum
- Kitpon Praipaisarnkit
- Malaysia Research Team
- Singapore Research Team
- Thailand Research Team
- Vincent Khoo Boo Aik
REG: Strategy: Alpha Picks - March 2024
GREATER CHINA Strategy Alpha Picks: March Conviction Call: Adding CMB, COLI, CR Beer, Kuaishou and TUL to our BUY list, closing out SELL calls. INDONESIA Strategy Alpha Picks: Significant Outperformance In Feb 24: Our picks are BBTN, CMRY, SIDO, EXCL, MAPI, JSMR, CTRA, MYOR and AKRA. MALAYSIA Strategy Alpha Picks: Focusing On Earnings Momentum: Our Alpha Picks underperformed the KLCI in Feb 24 (-0.9% vs 2.5%). Mar 24 picks significantly feature companies with good earnings momentum. SINGAPORE...
AS7 ANTA SPORTS PRODUCTS LTD.
A117ME ALIBABA GROUP HOLDING LTD. SPONSORED ADR
GRU GEELY AUTOMOBILE HOLDINGS LIMITED
KKP KIATNAKIN BANK
00688 CHINA OVERSEAS LAND & INVESTMENT LIMITED
00016 SUN HUNG KAI PROPERTIES LIMITED
00992 LENOVO GROUP LIMITED
00291 CHINA RESOURCES BEER (HOLDINGS) CO. LTD.
CPF CHAROEN POKPHAND FOODS PUBLIC CO. LTD.
ES ESSO SOCIETE ANONYME FRANCAISE
AKRA PT AKR CORPORINDO TBK
544 CSE GLOBAL LTD.
01109 CHINA RESOURCES LAND LIMITED
00388 HONG KONG EXCHANGES & CLEARING LTD.
CTRA CIPUTRA DEVELOPMENT
EGCO ELECTRICITY GENERATING PUBLIC CO. LTD.
STEC SINO-THAI ENGINEERING & CONSTRUCTION PCL
02328 PICC PROPERTY & CASUALTY CO. LTD. CLASS H
600809 SHANXI XINGHUACUN FEN WINE FACTORY CO. LTD. CLASS A
V03 VENTURE CORPORATION LIMITED
ERW ERAWAN GROUP
TOP THAI OIL PUBLIC CO. LTD.
U96 SEMBCORP INDUSTRIES LTD.
SXC SUNNY OPTICAL TECHNOLOGY (GROUP) CO. LTD.
JSMR PT JASA MARGA (PERSERO) TBK CLASS B
002594 BYD COMPANY LIMITED CLASS A
RLF LONGFOR GROUP HOLDINGS LTD.
KLBF PT KALBE FARMA TBK
EA ENERGY ABSOLUTE PUBLIC CO. LTD.
TU THAI UNION GROUP PUBLIC COMPANY LIMITED
COM7 COM7
ADVANC ADVANCED INFO SERVICE PUBLIC CO. LTD.
600585 ANHUI CONCH CEMENT COMPANY LIMITED CLASS A
00027 GALAXY ENTERTAINMENT GROUP LIMITED
MYOR MAYORA INDAH
C52 COMFORTDELGRO CORPORATION LIMITED
BMRI PT BANK MANDIRI (PERSERO) TBK
ORI1 ORIENT OVERSEAS (INTERNATIONAL) LIMITED
Z74 MINOR INTERNATIONAL PUBLIC CO. LTD.
MAPI SINGAPORE TELECOMMUNICATIONS LIMITED
O39 MITRA ADIPERKASA
AP4 OVERSEA-CHINESE BANKING CORPORATION LIMITED
ADRO RIVERSTONE HOLDINGS
601888 PT ADARO ENERGY TBK
PTTGC CHINA TOURISM GROUP DUTY FREE CORPORATION LIMITED CLASS A
TLKM PTT GLOBAL CHEMICAL PUBLIC COMPANY LTD
ROTI PT TELKOM INDONESIA (PERSERO) TBK CLASS B
M4B NIPPON INDOSARI CORPINDO
SE CHINA MERCHANTS BANK CO. LTD. CLASS H
SEA ADS
INRI COSCO SHIPPING HOLDINGS CO. LTD. CLASS H
PTTEP-R INARI AMERTRON BHD
BAL PTT EXPLORATION & PRODUCTION PCL NVDR
SCGB BUMITAMA AGRI LTD
KPJ SUNWAY CONSTRUCTION GROUP BH
SMM KPJ HEALTHCARE BERHAD
3933 SEMBCORP MARINE LTD
MINT THE UNITED LABORATORIES INTE
BURSA MAPLETREE INDUSTRIAL TRUST
MSGB BURSA MALAYSIA BHD
IOI MAH SING GROUP BHD
CPALL TB IOI CORP BHD
ECW CP ALL
GENM ECO WORLD DEVELOPMENT GROUP
MAHB GENTING MALAYSIA BHD
06098 MALAYSIA AIRPORTS HLDGS BHD
01801 COUNTRY GARDEN SERVICES HOLDINGS CO. LTD.
2013 INNOVENT BIOLOGICS INC.
EKO WEIMOB INC
RGB EKOVEST BHD
SCB-R RGB INTERNATIONAL BHD
709 SIAM COMMERCIAL BANK PCL NVDR
FEH GIORDANO INTERNATIONAL LTD
1093 FOOD EMPIRE HOLDINGS LTD
1199 CSPC PHARMACEUTICAL GROUP LTD
601138 COSCO SHIPPING PORTS LIMITED
FRKN FOXCONN INDUSTRIAL INTERNET CO. LTD. CLASS A
MPM FRENCKEN GROUP LTD
MRDIY MARCO POLO MARINE LTD
09988 MR DIY GROUP M BHD
09999 ALIBABA GROUP HOLDING LTD.
2696 NETEASE INC
KEX SHANGHAI HENLIUS BIOTECH INC
OR KERRY EXPRESS (THAILAND)
TIDLOR PTT OIL & RETAIL BUSINESS PCL
1209 NGERN TID LOR PCL
BUKA CHINA RESOURCES MIXC LIFESTYLE SERVICES
CVL BUKALAPAK.COM PT TBK
01024 CIVMEC
PDD KUAISHOU TECHNOLOGY CLASS B
09888 PINDUODUO PDD US
BBTN BAIDU INC
BBNI BANK TABUNGAN NEGARA PERSERO TBK PT
EXCL BANK NEGARA INDONESIA PERSER
GOTO XL AXIATA TBK PT
CMRY GOJEK TOKOPEDIA TBK PT
CLAS PT CISARUA MOUNTAIN DAIRY TBK
SMGR CAPITALAND ASCOTT TRUST
NATGATE SEMEN INDONESIA PERSERO TBK
NCKL NATIONGATE HOLDINGS BHD
SUNWAY PT TRIMEGAH BANGUN PERSADA TBK (HARITA NICKEL)
ESSO SUNWAY BHD
HUME ESSO THAILAND PCL
09961 HUME CEMENT INDUSTRIES BHD
BTG CTRIP.COM INTERNATIONAL
BETAGRO PUBLIC COMPANY LIMITED
- Greater China Research Team
China Strategy Alpha Picks: March Conviction Call
The HSI and MSCI China rose 6.6% and 8.2% mom respectively in Feb 24, mainly contributed by heavy-weighted IT and consumer discretionary stocks amid strongerthan- expected policy easing, which led to improved market sentiment. We expect sentiment to remain positive in March, as further macro supportive measures should be unveiled during the Two Sessions. We are adding CMB, COLI, CR Beer, Kuaishou and TUL to our BUY list and closing out the SELL ideas.
00992 LENOVO GROUP LIMITED
00291 CHINA RESOURCES BEER (HOLDINGS) CO. LTD.
SXC SUNNY OPTICAL TECHNOLOGY (GROUP) CO. LTD.
RLF LONGFOR GROUP HOLDINGS LTD.
M4B CHINA MERCHANTS BANK CO. LTD. CLASS H
3933 THE UNITED LABORATORIES INTE
1199 COSCO SHIPPING PORTS LIMITED
601138 FOXCONN INDUSTRIAL INTERNET CO. LTD. CLASS A
01024 KUAISHOU TECHNOLOGY CLASS B
- Kenny Yong Hui Lim
China Banking: It is the best of times, it is the worst of times.
The HSMBI has soared 8.5% ytd, riding on the tailwinds of valuation recovery and Central Huijin purchase. We opine that the subsequent valuation recovery needs to be further supported by fundamental improvements. However, the recent five-year LPR cut could continue to weigh on banks’ NIM and top-line growth. Banks’ asset quality remains stable, but the underlying vulnerabilities still persist. Maintain UNDERWEIGHT with CMB as our top pick.
- Kenny Yong Hui Lim
China Banking: H-shares: Laggard bargains or fairly priced?
The A-shares for China banks are outperforming their H-shares due to the widening yield gaps and buying momentum from the sovereign fund. However, our analysis suggests that the attractive valuation and dividend yield could improve H-shares performance in the near term. CMB is our top pick.
- Greater China Research Team
China Merchants Bank Co (3968 HK): When the going gets tough, the toug...
Against the backdrop of a slowing economy in China and prolonged margin squeeze, CMB’s earnings growth slowdown is expected to persist into 2024. However, we believe that the market may have fully priced in the earnings headwinds after its valuation was halved from its peak during the grace period. With its robust capital and ample provision buffers, CMB could be a safer bet among peers in this challenging environment. Maintain BUY with a lower target price of HK$40.00.
- Greater China Research Team
- Jo Yee Ng
- Julia Pan Mengyao
- Ming San Soong
- Shirley Wang Xueyi
- Stella Guo Yuting
Greater China Daily: Thursday, January 11, 2024
KEY HIGHLIGHTS Sector Catering Pick Haidilao in the near term on better operating leverage. Maintain UNDERWEIGHT. Update Alibaba Group (9988 HK/BUY/HK$69.75/Target: HK$102.00) 3QFY24 preview: Improving GMV and advertising growth bolstered by ad-tech upgrade initiatives. China Merchants Bank Co (3968 HK/BUY/HK$25.80/Target: HK$40.00) When the going gets tough, the tough get going. TRADERS’ CORNER Techtronic Industries (669 HK): Trading Buy range: HK$86.00-87.00 Hisense Home Appliances Group ...
- Greater China Research Team
China Merchants Bank Co. (3968 HK): 3Q23: Results miss; longer wait ne...
CMB reported disappointing 3Q23 results with both revenue and profit missing our expectations, underpinned by sluggish fee income and lower trading gains. NIM squeeze improved in 3Q23 but management guided that the NIM level may further decline in 2024 and fee income growth is still under pressure due to the fee rate cut and volatile market. Maintain BUY with a lower target price of HK$45.00 to reflect our cautious stance on CMB to restore double-digits earnings growth in 2023/24.
- Greater China Research Team
China Construction Bank (939 HK): 3Q23: Results in line; earnings up 2...
CCB’s 3Q23 earnings came in largely within our expectation with a 2.6% yoy growth, thanks to 24% lower provisions despite experiencing a negative revenue growth. CCB’s NIM compression eased slightly with a 7bp qoq decline as we saw the bank’s efforts in optimising its balance sheet structure. However, we have revised down our earnings estimates after delaying our expectations for a NIM turnaround to as early as 3Q24. Maintain BUY with a lower target price of HK6.00.
- Bella Lu Yifei
- Carol Dou Xiao Qin
- Greater China Research Team
- Jo Yee Ng
- Johnny Yum Chung Man
- Kate Luang
- Ken Lee
- Shirley Wang Xueyi
- Stella Guo Yuting
- Sunny Chen
- Terence Chiu
- Ziv Ang Sze Champ
Greater China Daily: Tuesday, October 31, 2023
KEY HIGHLIGHTS Strategy Small-Mid Cap Biweekly Pet food exports on track for recovery; beneficiary: Yantai China Pet Food. Results BYD Company (1211 HK/BUY/HK$246.20/Target: HK$630.00) 3Q23: Earnings up 82% yoy and 53% qoq, in line. Maintain BUY. Target price: HK$630.00. China Construction Bank (939 HK/BUY/HK$4.48/Target: HK$6.00) 3Q23: Results in line; earnings up 2.6% on lower credit costs. China Merchants Bank Co. (3968 HK/BUY/HK$30.30/Target: HK$45.00) 3Q23: Results miss; longer wait ne...
X2S SINOPHARM GROUP CO. LTD. CLASS H
002472 ZHEJIANG SHUANGHUAN DRIVELINE (A)
603288 FOSHAN HAITIAN FLAVOURING & FOOD CO. LTD. CLASS A
601689 NINGBO TUOPU GROUP CO. LTD. CLASS A
2899 ZIJIN MINING GROUP CO. LTD. CLASS H
M4B CHINA MERCHANTS BANK CO. LTD. CLASS H
1211 BYD COMPANY LIMITED CLASS H
§3§3 CHINA RESOURCES CEMENT
333 MIDEA GROUP
300760 SHENZHEN MINDRAY BIO-MEDICAL ELECTRONICS CO. LTD. CLASS A
002340 GEM CO LTD
06690 HAIER SMART HOME CO. LTD. CLASS H
- Greater China Research Team
China Banking: 3Q23 results preview: Earnings growth expected to reach...
We expect CCB’s and CMB’s earnings to grow 3.4% and 6.7% yoy due to lower impairment despite NIM dilution and subdued fee income. Although household loans remained sluggish in August, early signs of an economic recovery indicate that the current policy easing measures may be gaining traction, potentially stimulating effective credit demand. Maintain MARKET WEIGHT. CMB remains as our top pick given its attractive valuation and compelling 6.4% dividend yields.
- Greater China Research Team
China Banking: 1H23 results wrap-up: Getting back on track slowly.
Chinese banks recorded a modest 2.7% earnings growth, primarily attributed to rising trading gains and reduced provisions, which counterbalanced the adverse effects of NIM compression and sluggish fee income. The sector's valuation has suffered in recent years due to market concerns on NIM compression and asset quality. At this point, the sector is trading at a fairly balanced valuation, with the attractive 7% yield offsetting the impact of NIM compression. Maintain MARKET WEIGHT.
- Greater China Research Team
China Banking: Not all bad for banks after several rate cuts.
In August, the PBOC lowered the 1-year LPR by 10bp to 3.45%, while surprisingly keeping the 5-year LPR at 4.20%. Additionally, the PBOC also allowed the repricing of existing mortgages to reduce mortgage borrowers’ financial burden. Against this backdrop, banks cut time deposit rates by a larger quantum to defend their NIM. All in all, the net impact of these rate cuts is minimal to banks’ NIM and earnings. Maintain MARKET WEIGHT. Top pick: China Merchants Bank.
- Greater China Research Team
China Merchants Bank (3968 HK): 1H23: Reduced provisions cushion NIM p...
CMB’s 1H23 earnings came in above our expectations, underpinned by lower provisions. Net interest income recorded a margin growth of 1.2% yoy as larger loan scale offset the NIM compression impact. Non-interest income remains a key drag on operating income due to the sluggish performance in wealth management income. Asset quality remains largely stable with the property risk exposure reaching its peak. Maintain BUY on CMB with a lower target price of HK$50.00.
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