AGRICULTURAL BANK OF CHINA(601288) 华创证券·2025-03-31 03:43Investment Rating - The report maintains a "Recommendation" rating for Agricultural Bank of China (601288) [1][4]. Core Views - The bank's asset quality has improved, with a notable growth in retail loans. The non-performing loan (NPL) ratio decreased to 1.3%, and the provision coverage ratio remains robust at 300% [1][8]. - The bank achieved a total operating income of 710.56 billion yuan in 2024, reflecting a year-on-year growth of 2.26%. The net profit attributable to shareholders increased by 4.73% to 282.08 billion yuan [1][3]. - The report highlights a steady growth in loans, particularly in retail lending, with personal consumption loans growing by 28.3% and personal business loans by 35% year-on-year [8]. Financial Performance Summary - 2024 Financial Metrics: - Total operating income: 710,555 million yuan - Year-on-year growth: 2.26% - Net profit attributable to shareholders: 282,083 million yuan - Year-on-year growth: 4.73% [3][9] - Future Projections: - Revenue growth forecast for 2025-2027 adjusted to 1.8%, 3.7%, and 5.7% respectively - Net profit growth forecast for the same period adjusted to 2.3%, 4.1%, and 5.3% respectively [8][9]. Asset Quality and Loan Structure - The NPL ratio improved, with a decrease of 2 basis points to 1.3%, and the NPL generation rate fell to 0.23% [8][11]. - Retail loans showed strong growth, with a year-on-year increase of 9.4% in Q4, while corporate loans grew by 11% [8][9]. - The bank's focus on county-level finance continues to yield positive results, with county loans growing by 12.3% year-on-year [8]. Valuation and Target Price - The current valuation is at 0.65 times the projected price-to-book (PB) ratio for 2025, with a target PB of 0.75, leading to a target price of 5.86 yuan per share [8][4]. - The report suggests that the bank is undervalued compared to its historical average PB of 0.58 [8].