Bank of Chengdu(SH:601838) INDUSTRIAL SECURITIES·2024-04-26 02:02Investment Rating - The report maintains a "Buy" rating for the company with a corresponding price-to-book (PB) ratio of 0.73 [1][6]. Core Insights - The company achieved a revenue of 21.7 billion and a net profit attributable to shareholders of 11.7 billion in 2023, reflecting year-on-year growth of 7.2% and 16.2% respectively [3][4]. - For Q1 2024, the company reported a revenue of 5.64 billion and a net profit of 2.85 billion, showing year-on-year growth of 6.3% and 12.8% respectively [3][4]. - The growth in revenue and profit is primarily driven by rapid scale expansion and impairment savings, although the growth rate has slowed due to declining interest margins [4]. Summary by Sections Performance Overview - In 2023, the company's revenue and net profit grew by 7.2% and 16.2% respectively, with Q4 2023 showing a slower growth of 0.1% in revenue and 6.8% in net profit [4]. - For Q1 2024, net interest income increased by 8.0% year-on-year, while fee income rose by 15.8% due to a low base from the previous year [4][5]. Asset Expansion - Total assets grew by 18.9% in 2023 and 19.6% in Q1 2024, with loans increasing by 28.9% and 27.4% respectively [4][5]. - The company’s loan distribution in 2023 was 88% for corporate loans and 12% for retail loans, with significant contributions from public sector financial loans and manufacturing loans [4]. Interest Margin and Asset Quality - The net interest margin for 2023 was 1.81%, a decrease of 23 basis points year-on-year, influenced by a reduction in loan yields [2][4]. - The company achieved a non-performing loan (NPL) ratio of 0.66% in Q1 2024, the lowest in recent years, with a provision coverage ratio of 504% [5]. Capital Adequacy - As of Q1 2024, the core Tier 1, Tier 1, and total capital adequacy ratios were 8.45%, 9.19%, and 13.07% respectively [5][6]. - The company is currently in a convertible bond conversion period, which is expected to further strengthen its core capital [5]. Earnings Forecast - The report slightly adjusts the earnings per share (EPS) for 2024 and 2025 to 3.23 and 3.60 respectively, with an estimated net asset value per share of 19.43 by the end of 2024 [6][8].