Bank of Chengdu(601838) 华龙证券·2024-11-06 10:28Investment Rating - The report assigns an "Overweight" rating to Chengdu Bank (601838 SH) for the first time [1] Core Views - Chengdu Bank maintains rapid credit expansion with total assets reaching 12,216 38 billion yuan, up 11 95% YoY, and loan balance growing 15 43% YoY to 7,223 12 billion yuan [1] - Asset quality remains excellent with NPL ratio at 0 66% and provision coverage ratio at 497 40% [1] - Net interest margin stands at 1 49%, showing stability, while capital adequacy ratios improve across all levels [1] - Investment returns benefit from favorable bond market conditions, with investment yield rising to 4 09% [1] Financial Performance - For 2024 Q1-Q3, Chengdu Bank achieves operating income of 172 billion yuan, up 3 2% YoY, and net profit attributable to parent company of 90 billion yuan, up 10 8% YoY [1] - The bank's deposit growth remains strong at 13 14% YoY, with deposits accounting for 76 42% of total liabilities [1] - Corporate loans and personal loans grow by 17 41% and 7 61% respectively compared to the previous year-end [1] Valuation and Projections - The report forecasts net profit attributable to parent company of 128 59, 134 23, and 152 39 billion yuan for 2024-2026 [1] - EPS is projected to grow from 3 37 yuan in 2024 to 4 00 yuan in 2026 [3] - The current price of 15 75 yuan implies 0 8x 2024E PB [1] Peer Comparison - Chengdu Bank's 2024E PB ratio of 0 80x is in line with peer average, slightly higher than Hangzhou Bank's 0 78x but lower than Ningbo Bank's 0 85x [4] - The bank's BVPS growth from 19 58 yuan in 2024E to 25 85 yuan in 2026E outpaces most peers [4] Asset Quality and Capital - NPL ratio remains stable at 0 66% from 2024 Q3 through 2026E [6] - Provision coverage ratio stays above 300% throughout the forecast period, though declining from 497 40% in 2024 Q3 to 304 77% in 2026E [6] - Capital adequacy ratios show consistent improvement, with core tier 1 capital ratio rising from 8 40% in 2024 Q3 to 11 80% in 2026E [6]