Minsheng Securities·2024-03-25 16:00Investment Rating - The report maintains a "Recommended" rating for the company, indicating a positive outlook for its growth potential and high dividend yield [7][20]. Core Insights - The company achieved a total revenue of 339.1 billion yuan in 2023, with a year-over-year decline of 1.6%, while the net profit attributable to shareholders was 146.6 billion yuan, reflecting a year-over-year increase of 6.2% [6]. - The net interest income decreased by 1.6% year-over-year, with a significant drop of 6.6% in Q4 2023, primarily due to adjustments in mortgage loan rates [6]. - The company’s non-performing loan ratio remained low at 0.95%, with a provision coverage ratio of 438%, indicating strong risk management capabilities [6][7]. - The wealth management strategy remains robust, with retail customer numbers reaching 197 million, a year-over-year increase of 7.1%, and retail assets under management (AUM) growing by 9.9% to 13.3 trillion yuan [6][7]. Financial Performance Summary - Revenue growth is projected to stabilize, with estimates of 344.7 billion yuan in 2024, 357.9 billion yuan in 2025, and 379.4 billion yuan in 2026, reflecting a gradual recovery [18][21]. - The forecasted earnings per share (EPS) for 2024, 2025, and 2026 are 6.06 yuan, 6.35 yuan, and 6.80 yuan respectively, indicating a positive growth trajectory [21]. - The company’s capital adequacy ratio is projected to remain strong, with a core capital adequacy ratio of 13.73% in 2023, increasing to 15.17% by 2026 [18][38]. Asset Quality and Risk Management - The non-performing loan ratio is expected to slightly improve to 0.93% in 2024 and stabilize at 0.91% in the following years, reflecting effective asset quality management [18][32]. - The provision coverage ratio is forecasted to decrease gradually but remains robust, indicating a solid buffer against potential loan losses [32]. Dividend and Valuation - The company has a cash dividend payout ratio of 35% for 2023, with a corresponding dividend yield of 6.29% based on the closing price on March 25 [7][20]. - The report suggests that the company is likely to experience a valuation recovery greater than the overall sector, supported by its strong fundamentals and strategic positioning [7].