Bank of Chengdu(SH:601838) Guotou Securities·2024-04-28 06:30Investment Rating - The investment rating for Chengdu Bank is "Accumulate-A" with a target price of 17.03 CNY, compared to the current stock price of 14.42 CNY as of April 26, 2024 [3]. Core Views - Chengdu Bank reported a revenue growth of 7.22% for 2023 and a net profit growth of 16.22%. For Q1 2024, revenue growth was 6.27% and net profit growth was 12.83%, indicating stable performance [1][6]. - The bank's performance is primarily driven by the expansion of interest-earning assets and a reduction in provisioning efforts, although net interest margin compression and rising costs have negatively impacted growth [1][6]. - The asset quality of Chengdu Bank continues to improve, with a non-performing loan (NPL) ratio decreasing to 0.66% in Q1 2024, and a provisioning coverage ratio of 504.29% [6][19]. Financial Performance Summary - Chengdu Bank's total revenue for 2023 was 21,702 million CNY, with a projected revenue of 22,790 million CNY for 2024, reflecting a growth rate of 5.01% [7][19]. - The bank's net profit for 2023 was 11,671 million CNY, with an expected increase to 13,271 million CNY in 2024, representing a growth rate of 13.71% [7][19]. - The bank's net interest margin for 2023 was 1.81%, down 23 basis points year-on-year, but is expected to show slight improvement in Q1 2024 [2][6]. Asset and Liability Management - Chengdu Bank's total assets reached 1,091,243 million CNY in 2023, with a projected increase to 1,291,034 million CNY by 2024 [19]. - The bank's loan portfolio grew significantly, with total loans exceeding 614,301 million CNY in 2023, and expected to reach 767,876 million CNY in 2024 [19]. - The bank maintained a stable deposit base, with total deposits surpassing 780,421 million CNY in 2023, indicating a strong funding position [19]. Market Position and Outlook - Chengdu Bank is well-positioned to benefit from the economic development of the Chengdu-Chongqing economic circle, with a focus on government-related infrastructure loans [6][19]. - The bank's strategy includes enhancing its presence in the retail banking sector while continuing to support public sector projects, which is expected to drive future growth [6][19].