Key investment points:
The index of the banking sector rose steadily this week (2.7-2.11), and the price to book ratio was lf0.5 as of the last trading day of this week 67pb, with a significant increase in the valuation compared with last week and an increase in the market heat. The average daily trading volume was 913.288 billion yuan (mom + 7.61%). This week, the central bank’s wide caliber (including 7-day reverse repo and 14d reverse repo) net recovered 800 billion yuan. The 7-day reverse repo interest rate remained at 2.10%, and the overall liquidity was at a good level; On Friday (February 11), it was announced that the weighted value of dr007 was 1.98%, which was lower than the reverse repurchase level and had good overall liquidity.
In the first week after the festival, the financial sector benefited from stable profit expectations and risk aversion, and the improvement of undervalued value accelerated. The stock price of {6010} and {6030} other sectors increased steadily after {6010} week’s listing, and the stock price of {6010} and {6030} other sectors increased steadily, excluding {6010} week’s {6010} week’s {6030} week’s} opening trend, The value return of the banking sector will be a high probability event. In addition, we see that the peripheral US bond yields continue to rise, the rate hike is expected and the magnitude of the increase, for the overvalued equity assets continue to form suppression, “squeeze the bubble”.
The process has come and will be accelerated. During this period, as an equity investment with relatively high risk, it is a better choice to turn to the banking sector with low risk, good asset quality trend and bottom valuation. In this process, we believe that the current valuation level of the banking sector is still at the bottom of the historical valuation level and there is a lot of room for improvement in the future, The follow-up can still have the value of absolute return improvement and can run out of the opportunity of relative excess return. It is recommended to pay active attention.
In January, the social finance data showed the policy effect. Under the background of the gradual recovery of real estate, the traditional economy and the new economy helped economic development and credit expansion. According to the social financing data released by the central bank in January, the increment of social financing scale in January 2022 was 6.17 trillion yuan, 984.2 billion yuan more than the same period last year. Among them, RMB loans to the real economy increased by 4.2 trillion yuan, a monthly statistical high, an increase of 380.6 billion yuan year-on-year; The expansion of social finance data shows the effect of the combination policy of reducing reserve requirements and interest rates in the early stage. It has become a consensus to accelerate the issuance of local bonds and strengthen infrastructure construction. Combined with the recent Q4 monetary policy implementation report of the central bank in 21 years, we note that the current monetary policy focuses on “demand contraction, supply shock and weakening expectations”. Therefore, we can effectively stimulate demand (household appliances and cars to the countryside), strengthen supply constraints (coal price control), pre stimulus (sufficient liquidity expectation and policy pre expectation), and do a good job in China’s own affairs, At the same time, pay attention to the changes of overseas epidemic situation, the improvement of inflation data and the monetary policy of developed economies. The bank’s valuation was improved and its profit expectation was good, maintaining the “recommended” rating.
Market performance
The banking sector index rose 6.11% this week, outperforming the market. This week, the Shanghai Composite Index rose 3.02%, the Shenzhen Component Index fell 0.78%, the gem index fell 5.59%, and the Shanghai and Shenzhen 300 index rose 0.82%. It is suggested to focus on high-quality joint-stock banks ( China Merchants Bank Co.Ltd(600036) , Industrial Bank Co.Ltd(601166) , Ping An Bank Co.Ltd(000001) ), large undervalued state-owned banks Postal Savings Bank Of China Co.Ltd(601658) , China Construction Bank Corporation(601939) and high-quality urban and rural commercial banks ( Bank Of Ningbo Co.Ltd(002142) , Bank Of Jiangsu Co.Ltd(600919) , Bank Of Chengdu Co.Ltd(601838) , Bank Of Chongqing Co.Ltd(601963) , Bank Of Hangzhou Co.Ltd(600926) , Bank Of Shanghai Co.Ltd(601229) , Shanghai Rural Commercial Bank Co.Ltd(601825) and Jiangsu Changshu Rural Commercial Bank Co.Ltd(601128) , Jiangsu Zhangjiagang Rural Commercial Bank Co.Ltd(002839) ).
Risk tips
Repeated epidemic risk, tightening monetary policy, increasing risk of non-performing rate, outbreak of major risks and events of default, etc.
