\u3000\u3 Guangdong Shaoneng Group Co.Ltd(000601) 988 Bank Of China Limited(601988) )
Highlights of the annual report: 1. The growth rate of revenue continued to rise, and the net profit increased by more than 12% year-on-year Bank Of China Limited(601988) annual revenue maintained an upward trend year-on-year, achieving an increase of nearly 7%, driving the growth rate of profit before provision to continue to rise. Under the stable asset quality, the company slightly increased the provision provision, and the year-on-year growth rate of net profit remained stable, achieving a high increase of 12% + in the whole year. 2. The rise in both volume and price drove the net interest income of 4q20 to increase by 1.8% month on month. The quarterly annualized interest rate spread rose 2bp month on month, mainly driven by the rise of asset side yield. It is expected that there are two factors: structure and interest rate. The proportion of high-yield loans under retail legislative bank increased. At the same time, it is expected that the interest rate of new loans will stabilize and rise to a certain extent. The interest payment rate on the liability side increased slightly 1bp, which is expected to be mainly affected by structural factors, and the degree of demand deposits decreased slightly. 3. The growth rate of net non interest income and net other non interest income was + 25.5% year-on-year. The growth rate of net handling fee income remained stable, among which the agency, consulting and custody business achieved a relatively beautiful growth rate, with a year-on-year increase of 17.8%, 29.5% and 32.5% respectively. The year-on-year growth rate of net other non interest income widened significantly to 71%, mainly due to the rapid growth of insurance business income and precious metal sales income in other business income. At the same time, investment income Q4 also increased well, with an increase of 4 billion in a single quarter.
Insufficient annual report: the non-performing rate of Q4 increased slightly month on month, but still decreased significantly compared with the beginning of the year, and the concern rate continued to decline. The non-performing rate in the fourth quarter was 1.33%. Although it increased by 4bp month on month, it decreased significantly by 13bp year-on-year. The non-performing rate of the whole year was relatively stable, and the non-performing rate was the best since 2015. The proportion of concerned loans decreased to 1.34% in Q4, which was stable and downward as a whole, and the company’s non-performing pressure weakened in the future.
Investment suggestion: the current share price of the company corresponds to 2022e and 2023epb0 45X/0.41X； PE4. 14x / 3.87x (pb0.53x/0.48x, pe4.76x/4.43x of state-owned banks). The overall operation of the company is stable and the asset quality performance is stable. The safety margin of the company’s valuation is high, so it is recommended to pay attention.
Note: according to the detailed data of the annual report of 2021, we adjusted the assumptions of key data such as scale growth, asset negative rate of return and credit cost, resulting in the adjustment of the profit forecast from 2022 to 2024 compared with the previous period. It is estimated that the operating revenue in 2022 / 2023 will be 637649/694067 billion yuan, with a growth rate of 14.6% / 8.9% (the previous value is 611.87/665.84 billion yuan, 8.8% / 8.8% respectively); The net profit attributable to the parent company was 233864 / 249608 million yuan, with a growth rate of 8.0% / 6.7% (the previous value was 212.01/222819 billion yuan, 5.3% / 5.1% respectively).
Risk tip: the economic downturn exceeded expectations and the company’s operation was less than expected.
