Ge Long Hui·2025-10-14 06:38Group 1 - The core viewpoint of the article is that JPMorgan expects HSBC's privatization of Hang Seng to have a positive impact on profitability [1] - JPMorgan calculates that the privatization will increase HSBC's net profit after tax (NPAT) by 3.7% by 2027, and earnings per share will rise by 0.1% [1] - The average return on tangible equity (ROTE) is projected to improve by 38 basis points due to the privatization [1] Group 2 - The privatization is expected to release approximately 40 basis points of HSBC's common equity tier 1 capital ratio (CET1) [1] - JPMorgan believes that the decline in HSBC's stock price has already reflected the downside risks associated with the transaction, predicting a sideways movement in the stock price in the short term [1] - Despite a lack of positive catalysts and no share buyback support, HSBC's long-term yield is still expected to reach 5%, with the risks from tariffs already considered [1] Group 3 - In light of the renewed tensions in US-China trade relations, JPMorgan anticipates that HSBC will outperform the Hang Seng Index, maintaining an "overweight" rating with a target price of HKD 122 [1]