HZBank(SH:600926) Orient Securities·2025-04-13 14:42Investment Rating - The report maintains a "Buy" rating for Hangzhou Bank with a target price of 16.48 CNY per share, reflecting a 20% valuation premium compared to comparable companies [3][6]. Core Insights - The report predicts a steady growth in net profit for Hangzhou Bank, with expected year-on-year growth rates of 16.5%, 15.1%, and 15.7% for 2025, 2026, and 2027 respectively. The book value per share (BVPS) is projected to be 19.87, 22.75, and 26.09 CNY for the same years [3][10]. - The bank's revenue and profit growth rates are positioned within the top tier of the industry, with a notable increase in net interest income and non-interest income contributing to overall performance [10]. Financial Performance Summary - Revenue: The bank's revenue is projected to grow from 35,016 million CNY in 2023 to 46,845 million CNY by 2027, with a compound annual growth rate (CAGR) of approximately 8.2% [5][13]. - Net Profit: The net profit attributable to the parent company is expected to rise from 14,383 million CNY in 2023 to 26,354 million CNY in 2027, reflecting a CAGR of about 15.7% [5][13]. - Earnings Per Share (EPS): EPS is forecasted to increase from 2.31 CNY in 2023 to 4.17 CNY in 2027 [5][13]. - Return on Assets (ROA): The bank's ROA is expected to stabilize around 0.9% from 2025 to 2027 [5][13]. - Return on Equity (ROE): The average ROE is projected to improve from 15.6% in 2023 to 17.1% in 2027 [5][13]. Asset and Liability Management - Loan Growth: Total loans are expected to increase significantly, from 807,096 million CNY in 2023 to 1,401,129 million CNY by 2027, indicating a strong demand for credit [13]. - Deposit Growth: Total deposits are projected to grow from 1,058,308 million CNY in 2023 to 2,030,151 million CNY in 2027, reflecting a robust deposit base [13]. - Asset Quality: The non-performing loan (NPL) ratio is expected to remain stable at 0.76% over the forecast period, indicating effective asset quality management [10][13]. Valuation Metrics - Price-to-Earnings (P/E) Ratio: The P/E ratio is projected to decrease from 6.25 in 2023 to 3.46 in 2027, suggesting an attractive valuation relative to earnings growth [5][13]. - Price-to-Book (P/B) Ratio: The P/B ratio is expected to decline from 0.92 in 2023 to 0.55 in 2027, indicating potential undervaluation [5][13].