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<Research>G Sachs Adjusts TPs on CN Banks, Forecasts Weak 1Q24 Earnings
Recommend 28 Positive 46 Negative 21 |
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Goldman Sachs issued a research report expecting average pre-provision operating profit (PPOP)/ net profit of its covered Chinese banks to change by an average of -5%/ +1% YoY in 1Q24. Goldman Sachs expected earnings to remain weak in 1Q24, due to weaker net interest margins and slower loan growth. Despite the challenging macro environment, provision release will continue to drive net profit growth, RWA density will be further reduced as Chinese banks hold more government bonds. CCB (00939.HK) is likely to keep dividend stable, given stronger balance sheet as compared with its peers. Therefore, Goldman Sachs rated CCB at Buy, and added its target price from $4.62 to $5.19. CM BANK (03968.HK)'s comprehensive valuation and revenue growth still face challenges, despite possible continuous dividend declaration. Therefore, Goldman Sachs rated CM BANK at Neutral, and cut its target price from $31.62 to $30.83. In addition, Goldman Sachs said that BANK OF NINGBO (002142.SZ) has a lower dividend yield, but its EPS is likely to be higher than peers, while its profit before provision growth is still ahead of peers. Therefore, Goldman Sachs rated BANK OF NINGBO at Buy, and trimmed its target price to RMB26.7 from RMB30.68. Given INDUSTRIAL BANK(601166.SH)'s uncertainties over its credit losses, Goldman Sachs rated INDUSTRIAL BANK at Sell, and cut its target price from RMB11 to RMB10.8. AAStocks Financial News |
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