Bank Of Shanghai(601229) 国盛证券·2025-02-23 05:23Investment Rating - The report assigns a "Buy" rating for Shanghai Bank, indicating it is a preferred dividend stock due to its high dividend yield and stable performance [5]. Core Views - Shanghai Bank is characterized by low valuation, high dividend yield, and stable positive growth in performance, making it an attractive investment option [19]. - The bank's dividend yield is 5.24%, which is higher than the industry average of 4.59%, and it has maintained a dividend payout ratio above 25% since 2017 [19][20]. - The bank's total assets reached 3.23 trillion yuan as of Q3 2024, reflecting a year-on-year growth of 5.5% [20]. Summary by Sections Investment Overview - The report highlights the attractiveness of high dividend stocks in the current economic environment, with a significant spread between bank dividend yields and government bond yields [19]. - Shanghai Bank's dividend payout ratio is expected to remain stable, with an increase to 30.7% projected for mid-2024 [19][20]. Company Overview - The management team has shown confidence in the bank's long-term value by consistently increasing their shareholdings over the past six years [3]. - Shanghai Bank has established a strong regional presence, particularly in the Yangtze River Delta, with a loan distribution of 78.6% in this area as of mid-2024 [3][9]. Fundamental Analysis - The bank's asset scale has been steadily increasing, with a compound annual growth rate of 8.1% over the past five years [20]. - The bank's net profit for the first three quarters of 2024 was 175.9 billion yuan, reflecting a year-on-year increase of 1.4% [20]. - The bank's cost advantages are evident, with a return on equity (ROE) of 9.32% and a return on assets (ROA) of 0.72% as of Q3 2024 [4]. - The bank's non-performing loan (NPL) ratio has been on a downward trend, currently at 1.20%, indicating improving asset quality [11][12].