\u3000\u3 Guangdong Shaoneng Group Co.Ltd(000601) 128 Jiangsu Changshu Rural Commercial Bank Co.Ltd(601128) )
Event: on March 30, the company released its annual report for 2021, with an operating revenue of 7.65 billion yuan, a year-on-year increase of + 16.3%, and a net profit attributable to the parent company of 2.188 billion yuan, a year-on-year increase of + 21.3%; Total assets + 18.2% year on year; The net interest margin was 3.06%, year-on-year – 12bp; The non-performing loan ratio was 0.81%, year-on-year – 15bp, and the provision coverage was 531.8%, year-on-year + 46.5pct.
Both revenue and profit increased. In terms of revenue splitting, the growth rate of net interest income in 2021 maintained a marginal upward trend, with a year-on-year increase of + 12.2% and a month on month increase of + 4.1pct, which is the “fruit” of high expansion; The net handling fee was + 61.0% year-on-year, mainly due to the good pulling effect of the growth of agency business; Other non interest bearing businesses + 55.2% year-on-year. In terms of profit splitting, the pulling effect of scale expansion is nearly 80%, and the drag of narrowing net interest margin on performance is significantly weakened.
Pratt Whitney benchmarking, growth for the better. The company’s credit supply has an obvious trend of “from small to micro”. In the new loan structure in 2021, the scale of single household below 100W and 100W-1000W contributed to the core increment, and the proportion of the two increased by 2.2pct and 3.8pct respectively year-on-year. With the transformation and blessing of retail banks, the proportion of personal loans has continued to increase, and the operating loans have further developed and tilted to other places, which is conducive to the long-term improvement of asset quality. The Pratt & Whitney policy may gradually decline, and the competition pattern tends to be mild, which is conducive to the growth space of the company’s small and micro businesses.
The net interest margin stabilized and rebounded. At the end of 2021, the net interest margin of the company was + 4bp compared with 21h1, stopping the continuous downward trend since 2020. The increase in yield brought about by the optimization of asset structure is the main reason for the stabilization of net interest margin. The loan is + 20.8% year-on-year, which is + 1.6pct compared with 21h1 and 4.4pct ahead of interest bearing assets, reflecting the strong local financing demand and driving the yield of interest bearing assets + 8bp month on month.
Asset quality continued to be excellent. In 2021, the company’s non-performing loan ratio was 0.81%, unchanged month on month, and is expected to be at a good level among listed banks. The coverage of some support provisions was significantly increased by 46.5pct, leaving sufficient space for back feeding profits. From the perspective of non-performing leading indicators, the proportion of concerned and overdue assets decreased by 7bp month on month in comparison with 21h1, and the proportion of each item of overdue assets decreased month on month, indicating that the asset quality is substantially consolidated and the stable and positive trend is obvious.
Strong recovery in investment quality, poor investment proposal
The performance is booming, the small and micro businesses continue to expand, the “small to micro” trend is obvious, the net interest margin has stabilized and rebounded, and the asset quality continues to be excellent. It is estimated that the EPS of 22-24 years will be 0.98 yuan, 1.18 yuan and 1.46 yuan respectively. The closing price on March 30, 2022 corresponds to 0.9 times of 22 years Pb, maintaining the “recommended” rating.
Risk tip: macroeconomic growth rate declines; The development of small and micro businesses is less than expected; Credit risk exposure.
