HZBank(SH:600926) Huachuang Securities·2025-12-01 07:34Investment Rating - The report gives Hangzhou Bank a "Recommended" rating, indicating an expectation to outperform the benchmark index by 10%-20% over the next six months [3][29]. Core Views - Hangzhou Bank is positioned as a high-growth and low-risk city commercial bank in Zhejiang, with a target price of 22.23 yuan based on a projected 2026E PB of 1.05X [3][12]. - The bank is expected to maintain a compound annual growth rate (CAGR) of approximately 15% in earnings over the next three years, with revenue growth rates projected at 2.1%, 10.9%, and 10.9% for 2025-2027, and net profit growth rates at 13.4%, 14.2%, and 16.0% respectively [3][12]. Financial Performance - For 2024, total revenue is projected to be 38,381 million yuan, with a year-on-year growth of 9.61%. By 2026, revenue is expected to reach 43,449 million yuan, reflecting a growth of 10.86% [4][15]. - The net profit attributable to the parent company is forecasted to be 16,983 million yuan in 2024, growing to 21,997 million yuan by 2026, with respective growth rates of 18.07% and 14.22% [4][15]. Business Model and Strategy - Hangzhou Bank has a clear geographical advantage, with over 70% of its branches and credit resources located in Zhejiang, a region characterized by a vibrant private economy and high wealth levels [8][9]. - The bank's business model is driven by three main segments: corporate banking, retail banking, and small and micro enterprises, with a focus on low-risk municipal projects and a strong emphasis on wealth management and consumer credit in retail banking [8][10]. Asset Quality - The bank maintains a strong asset quality, with a non-performing loan (NPL) ratio of 0.76%, which has remained stable for 11 consecutive quarters, positioning it among the top tier of listed banks [10][11]. - The provision coverage ratio stands at 514%, indicating robust risk mitigation capabilities [10][11]. Capital Position - The successful redemption of 150 billion yuan in convertible bonds has strengthened the bank's core Tier 1 capital by 106.4 billion yuan, with the core Tier 1 capital adequacy ratio reaching 9.64% as of Q3 2025 [11][12]. - The bank's dividend payout ratio is expected to increase gradually, with projections of 23.5%, 24%, and 25% for 2025-2027 [14].