\u3000\u3 Jointo Energy Investment Co.Ltd.Hebei(000600) 036 China Merchants Bank Co.Ltd(600036) )
Key investment points
Data overview
21a net profit attributable to the parent company was + 23.2% year-on-year, and the growth rate was + 1.0pc month on month; Revenue + 14.0% year-on-year and growth rate + 0.5pc month on month; ROE17. 0%, year-on-year + 1.2pc; ROA1. 36%, year-on-year + 13bp. The non-performing rate was 0.91%, with a chain comparison of – 2bp, and the provision coverage rate was 484%, with a chain comparison of + 41pc.
Core view
I. upgrade the strategic blueprint. 3.0 the mode direction is clear, “the business mode of big wealth management + digital operation mode + open and integrated organization mode”. The strategic blueprint is clearer and the promotion effect is gratifying. (1) The wealth strategy has achieved remarkable results. In 2021a, China Merchants Bank made full efforts in wealth management. ① At the scale end, retail AUM was + 20.3% year-on-year, with a high growth rate of + 0.1pc month on month; In the structure, the proportion of public funds increased. In 21q4, the number of non monetary public funds increased by 11% month on month, 8pc faster than AUM; ② On the income side, the middle income of wealth was + 29% year-on-year, and the growth rate was + 3pc month on month; The medium income of asset management increased by 58% year-on-year, with a growth rate of + 12pc month on month. The growth of wealth income is mainly supported by financial management, funds and insurance. The sales of financial management, funds and insurance on a commission basis are + 54%, 36% and 43% year-on-year respectively, and the growth rate is + 11pc, 11pc and 5pc month on month. (2) Open and integrate to cultivate internal skills. In the future, wealth management will shift from sales orientation to asset allocation orientation, which will essentially test the “internal skills” of wealth management such as comprehensive services of banks. In the CMB 3.0 model, it is proposed to build an open and integrated organizational model, which is expected to stand firmly at the forefront of wealth management by cultivating “internal skills”.
II. Double reduction of non-performing products China Merchants Bank Co.Ltd(600036) 2021 impairment loss + 2% year-on-year, with a growth rate of -5pc month on month, which is the biggest support for profitability. Among them: (1) as for stock index, non-performing assets decreased both (balance – 0.9% month on month and non-performing rate – 2bp month on month). Overdue 90 + deviation and provision coverage reached the best 69% and 484% in history. It is worth noting that: ① the overdue rate of credit cards is + 21bp month on month. It is speculated that it is due to the listing of ABS of some credit cards (Q4 public offering of nearly 18 billion, resulting in the decrease of the denominator of overdue loan rate), the change of overdue identification standards, and the actual risk is controllable; ② Affected by the upward risk of the industry, the non-performing rate of real estate increased to 1.41% compared with 21h1 + 34bp. Considering that China Merchants Bank has adjusted the scale of real estate related business and the end of real estate policy has been realized, it is expected that the impact of real estate will gradually subside. 21q4 the balance with and without credit risk was – 1.7% and – 13.9% month on month. (2) According to the flow index, the generation rate of non-performing products in 2021a is 0.95%, year-on-year -31bp. In 2021q4, the non-performing amount in a single quarter was – 4.5% year-on-year. In terms of impairment provision, the strength of credit impairment has increased significantly, presumably in response to the rise of real estate risk. Q4 single quarter credit impairment provision of 25.8 billion, non credit impairment reversal of 16.1 billion, while the credit impairment in the first three quarters accounted for only 20% of the credit impairment. (3) Looking ahead, we need to pay close attention to the impact of real estate related risks on asset quality.
III. improvement of debt structure. 2021q4 net interest margin rose from + 1bp to 2.48% month on month, mainly due to: ① improved debt structure. 21q4 China Merchants Bank‘s deposits increased by + 5.6% month on month, 2pc faster than the total liabilities, of which demand deposits increased by + 8.9% month on month, supporting the interest margin. ② The growth rate of interest bearing assets (mom + 3%) was faster than that of interest bearing liabilities (2%), driving up the interest margin. Looking ahead, the margin of interest rate spread is expected to be under pressure under the background of downward interest rate, but the optimization of liability side can form a supporting role.
Profit forecast and valuation
It is estimated that from 2022 to 2024, the net profit attributable to the parent company will increase by 15.40% / 15.52% / 15.56% year-on-year, corresponding to bps32 91 / 37.40/42.59 yuan shares. The current price corresponds to 1.40/1.23/1.08 times of Pb valuation. Maintain the target price of 62.50 yuan / share, corresponding to 22 years of PB1 90x, the current price corresponds to 22-year PB1 40x, the current price space is 35%.
Risk tip: macroeconomic stall and substantial exposure of adverse.
