NJBK(601009) 华泰证券·2024-10-11 02:03Investment Rating - The report maintains a Buy rating for Nanjing Bank with a target price of RMB 12.94 [2] Core Views - Nanjing Bank is considered a high-quality city commercial bank with both dividend yield and growth potential [3] - The bank's strategic transformation is effective, and its business expansion prospects are broad, justifying a valuation premium [3] - The bank's EPS is forecasted to be RMB 1.95/2.19/2.46 for 2024-2026, with a 2025 BVPS of RMB 16.18 and a PB ratio of 0.64x [3] - The bank's 2025 target PB is set at 0.80x, higher than the industry average of 0.54x [3] Shareholder Confidence - Eastern Airport Group Investment Co, a subsidiary of Jiangsu SASAC, increased its stake in Nanjing Bank by 1.16%, reflecting confidence in the bank's future development [4] - Earlier in 2024, BNP Paribas and BNP Paribas (QFII) also increased their stakes, further demonstrating investor confidence in the bank's growth potential [5] Financial Performance - In H1 2024, Nanjing Bank reported 7.9% YoY revenue growth and 8.5% YoY net profit growth, with a dividend yield of 5.04% (TTM) [6] - The bank's convertible bonds are in a critical conversion period, with the current stock price 7% below the mandatory conversion price [6] - If the remaining RMB 14.4 billion convertible bonds are converted, the bank's core tier 1 capital adequacy ratio could increase by 0.87pct to 9.84% [6] Valuation and Forecasts - The bank's 2024-2026 revenue is projected to grow at 7.26%/7.50%/8.20%, reaching RMB 48.4/52.1/56.3 billion [7] - Net profit is expected to grow at 10.80%/12.29%/12.13%, reaching RMB 20.5/23.0/25.8 billion [7] - The ROE is forecasted to be 11.58%/11.93%/12.24% for 2024-2026, with a dividend yield of 5.64%/6.34%/7.10% [7] Business Strategy - Nanjing Bank is focusing on corporate banking in areas like technology innovation, inclusive finance, and international business, while leveraging its retail banking strengths [6] - The bank is also migrating its consumer finance experience to its parent bank to expand its business space [6]