HKEX(00388) 国泰君安·2024-05-09 23:32Investment Rating - The report maintains a "Buy" rating for the company with a target price of 430 HKD, corresponding to a PE of 41.6x for 2024 [3][4]. Core Insights - The company's performance is under pressure due to a decline in investment income, primarily caused by falling contract prices leading to a reduction in margin requirements. In Q1 2024, the company's revenue and net profit were 3.847 billion and 2.970 billion HKD, respectively, reflecting year-on-year declines of 6.42% and 12.85% [3]. - The China Securities Regulatory Commission has announced measures to enhance cooperation with Hong Kong, which, along with expectations of a continued trend of US dollar interest rate cuts, is likely to boost the activity level in the Hong Kong stock market, driving the company's revenue growth beyond expectations [3][4]. Financial Summary - For the fiscal years 2024 to 2026, the company is projected to achieve revenues of 22.2 billion, 24.3 billion, and 26.9 billion HKD, with net profits of 13.1 billion, 14.7 billion, and 16.6 billion HKD, respectively [3][5]. - In Q1 2024, the company's investment income decreased by 12.57% to 1.342 billion HKD, accounting for a negative contribution of 54.06% to total revenue growth. The average margin size decreased by 25.47% to 18.46 billion HKD [3][5].