INDUSTRIAL BANK(SH:601166) EBSCN·2024-08-23 07:09Investment Rating - The report maintains an "Accumulate" rating for the company, with a current price of 16.82 CNY [1]. Core Views - The company has shown significant cost control effectiveness, with notable advantages in its three key business areas [1]. - The company's revenue and profit have improved, with a year-on-year revenue growth of 1.8% and a net profit growth of 0.9% for the first half of 2024 [6][10]. - The bank's strategic focus on "light capital, light assets, and high efficiency" is expected to drive future growth, supported by digital transformation initiatives [10]. Financial Performance Summary - For the first half of 2024, the company achieved operating income of 113 billion CNY, with a year-on-year increase of 1.8%, and a net profit attributable to shareholders of 43.05 billion CNY, up 0.9% [6]. - The annualized weighted average return on equity (ROE) for the first half of 2024 was 11%, a decrease of 0.9 percentage points year-on-year [6]. - The bank's net interest income and non-interest income growth rates were 4.2% and -2.6%, respectively, indicating a decline in non-interest income compared to the first quarter of 2024 [7]. Asset and Liability Management - As of the end of the second quarter of 2024, the bank's interest-earning assets and loans grew by 6.1% and 8.6% year-on-year, respectively [7]. - The bank's deposit structure has been optimized, with a reduction in high-cost liabilities, leading to a net interest margin of 1.86% [8]. - The bank's non-performing loan (NPL) ratio remained low at 1.08%, with a stable risk compensation ability [9][10]. Future Outlook - The report forecasts earnings per share (EPS) for 2024, 2025, and 2026 to be 3.83 CNY, 4.02 CNY, and 4.15 CNY, respectively, with a current price-to-book (PB) ratio of 0.49, indicating a favorable investment valuation [10][12]. - The bank's strategic initiatives in wealth management and investment banking are expected to enhance its revenue growth potential in the future [10].