\u3000\u3 Jointo Energy Investment Co.Ltd.Hebei(000600) 926 Bank Of Hangzhou Co.Ltd(600926) )
Strong performance growth and advanced profitability
The company’s 22q1 revenue and net profit attributable to the parent company increased by 15.73% and 31.39% year-on-year, with a year-on-year growth rate of 2.63 PCT and 1.62 PCT lower than that of 2021. The year-on-year growth rate of 22q1 performance is much higher than that of peers with disclosed data. The compound growth rate in recent two and three years in a single quarter reached 23.64% and 22.16%, showing a high level of profit release ability. 22q1 weighted average roe reached 16.20%, with a year-on-year increase of 2.44pct.
Both deposits and loans are booming, and the focus of credit supply is prominent
The credit supply of 22q1 company maintained a high growth, and the total loans and advances issued at the end of the period increased by 21.92% year-on-year, which was basically the same as that at the end of 21q4. 22q1 company increased its loans by 41.8 billion yuan, an increase of 6 billion yuan year-on-year, of which corporate loans increased by 6.6 billion yuan year-on-year. The strong regional credit demand superimposed on the company’s rich project reserves, and the credit supply achieved a “good start” in the first quarter. At the end of 22q1, the total deposits absorbed by the company increased by 18.32% year-on-year, with a year-on-year growth rate of 2.18pct higher than that at the end of 21q4. 22q1 new deposits reached 58.4 billion yuan, an increase of 21.3 billion yuan year-on-year, both faster than the loan. Among them, corporate demand deposits increased by 21.9 billion yuan, an increase of 19.2 billion yuan year-on-year, and the debt structure continued to improve.
The company continued to increase credit in key areas and promote a better and better credit structure. The amount of loans invested in manufacturing industry in 22q1 increased by 20.67% year-on-year. The balance of green loans and agriculture related loans at the end of the period increased by 12.66% and 27.61% compared with the end of the previous year, both faster than the overall credit expansion speed. In promoting the development of small and micro businesses, we focused on credit loans, and the loan balance at the end of the period increased by 13.90% compared with the end of the previous year.
The quality of assets was solid, and the provision coverage continued to reach a new high
The non-performing rate at the end of 22q1 was 0.82%, down 4bp from 21q4, and the proportion of concerned loans was 0.38%, unchanged from the end of 21q4. The total proportion of non-performing and concerned loans remained at a low level of 1.2%. Under the consolidation of asset quality, the pressure of impairment provision of the company slowed down. 22q1 loan impairment loss decreased by 46.12% year-on-year, but the provision coverage increased by 12.38pct to 580.09% compared with the end of 21q4, the highest level in history, and is expected to continue to rank first among listed banks. The thickness of provision has continued to increase, and the ability of risk offset and profit feedback has been enhanced.
Endogenous and exogenous two pronged approach, steady progress in capital replenishment
By the end of 22q1, the company’s core tier 1 capital adequacy ratio was 8.17%, down 26bp from the end of 21q4. Over the past two years, the year-on-year growth rate of corporate loans has increased from 15% to about 20%, and the consumption of core tier 1 capital is fast. However, the rapid release of performance helps to improve the endogenous growth capacity of capital. In addition, the company’s convertible bonds are in the stock conversion period, and the positive share price is less than 15% from the strong redemption line. According to the static calculation, if the equity conversion is completed, the core Tier-1 capital adequacy ratio can be improved by 1.62pct, and the supplement of endogenous and exogenous capital can lay a good advance for the expansion of the company’s assets.
Investment suggestions: continue to make efforts during the “2255” period and release the performance at a high level
At present, the construction of Zhejiang common prosperity demonstration zone has entered the substantive implementation stage. It is expected that the favorable policies will continue to be released, the regional financial demand is expected to remain active, and there is a large space for credit demand. Under the “2255” strategy, the two growth poles of “expanding retail” and “optimizing small and micro enterprises” are expected to accelerate. We are optimistic about the growth of the company’s performance and adjust the growth rate of net profit attributable to the parent company from 22%, 18.38% and 17.07% to 27.37%, 20.82% and 16.94% from 2022 to 2024. At present, the corresponding company’s Pb (LF) is 1.20 times, maintaining 1.5 times the target Pb in 2022, and the corresponding target price is 20.42 yuan, maintaining the “buy” rating.
Risk tip: the demand for credit of small and micro enterprises is insufficient, the retail transformation is less than expected, and the credit risk fluctuates
