QFIN(US:QFIN) Zhi Tong Cai Jing·2025-07-04 10:19Group 1 - The core viewpoint of the report is that JPMorgan Chase has initiated coverage on Qifu Technology (QFIN.US) with an "Overweight" rating and a target price of $65, indicating approximately 50% upside potential from the current stock price, corresponding to a projected P/E ratio of 7.5 times for 2026 [1] - Qifu Technology is expected to achieve a compound annual growth rate (CAGR) of 24% in adjusted EPS from 2024 to 2027, the highest among similar institutions covered by JPMorgan in Greater China [1] - The adjusted return on equity (ROE) for Qifu Technology is projected to increase from 15.7% in 2024 to 24.6% in 2027, driven by an expansion in the proportion of light capital business and optimization of financing costs [1] Group 2 - The business model of Qifu Technology shows an increase in the proportion of light capital loans from 44% in 2023 to 53% in 2024, with expectations to reach 56% by 2027 [1] - The Intelligent Credit Engine (ICE) business is expected to account for 39% of new loans by Q1 2025, which does not bear credit risk and has a high net fee rate [1] - The asset quality of Qifu Technology remains stable, with a 90-day overdue rate maintained between 1.0% and 3.5%, and both the provision coverage ratio and loan loss reserves to loans ratio at historical highs [1] Group 3 - Technological advancements are a significant highlight for Qifu Technology, with the launch of an AI agent platform in 2025 that will drive one-third of core processes within 1-2 years [2] - The company is enhancing its data mining and risk management capabilities through DeepSeek technology, transitioning from single-modal to multi-modal data analysis [2] - AI-driven marketing strategies have improved user reach efficiency by 25.1% and reduced customer acquisition costs by approximately 10% [2] Group 4 - Qifu Technology has committed to providing strong returns to shareholders, with total return rates (dividends + buybacks) expected to account for 17%, 14%, and 12% of the current market value from 2025 to 2027, ranking among the top in its peer group in the Asia-Pacific region [2] - The current stock price of Qifu Technology corresponds to a P/E ratio of 5.0 times and a P/B ratio of 1.4 times, which is below the average level of similar institutions in Greater China, indicating significant potential for price appreciation [2] - As a leading player in the fintech industry, Qifu Technology has shown stable growth in new loans, outperforming its peers following industry consolidation [2]