Core Viewpoint - The report highlights the stable profitability and attractive dividend yield of Industrial and Commercial Bank of China (ICBC), positioning it as a favorable investment opportunity in the Hong Kong banking sector [1][5]. Group 1: Profitability and Dividend Yield - ICBC has maintained a compound annual growth rate (CAGR) of 3.2% in net profit attributable to shareholders from 2019 to 2024, supported by stable asset quality and improving credit costs, sustaining a return on equity (ROE) around 11.5% [1]. - The projected dividend yield for ICBC in 2025 is approximately 5.6%, the highest among major Hong Kong banks, which is expected to attract long-term capital inflows [1]. - Despite a challenging operating environment, ICBC's revenue and profit performance in Q1 2025 may be temporarily below expectations, but a return to positive growth for the full year is likely [1]. Group 2: Credit Growth and Structure - From 2019 to 2024, ICBC's credit growth has a CAGR of about 11.1%, aligning with the average of the four major banks [2]. - The corporate lending segment has contributed 65% of the credit increment, with government-related infrastructure loans accounting for 43.4% of total loan growth [2]. - Since 2022, ICBC has increased lending to emerging sectors such as manufacturing and green industries, optimizing its credit structure [2]. Group 3: Interest Margin and Cost of Funds - ICBC's net interest margin in Q1 2025 was 1.33%, slightly below the average of the four major banks [3]. - The bank's deposit cost for 2024 is estimated at 1.72%, which is better than the average of its peers, but it has faced faster declines in loan pricing [3]. - The central bank's focus on financial stability is expected to support a stabilization of ICBC's interest margin in the future [3]. Group 4: Asset Quality - ICBC's non-performing loan (NPL) ratio decreased to 1.33% in Q1 2025, reflecting a cumulative decline of 25 basis points since 2020 [4]. - The bank's provision coverage ratio remains high at 215.7%, indicating strong asset quality management [4]. - While corporate loan quality is improving, retail loan risks have started to emerge, with the retail NPL ratio increasing to 1.34% in 2024 [4]. Group 5: Investment Recommendation - The banking sector is increasingly characterized by a "dumbbell" structure, with state-owned banks like ICBC positioned as stabilizing forces [5]. - The forecasted growth rates for net profit attributable to shareholders from 2025 to 2027 are 0.9%, 3.1%, and 4.3%, respectively [5]. - Given ICBC's stable ROE and attractive dividend yield, a target price-to-book (PB) ratio of 0.64x for 2025 is suggested, indicating a potential upside of 25% [5].

上 市 公 司 公 司 研 究 / 公 司 报 告 报告原因：首次覆盖 买入（首次评级） | 市场数据： | 2025 年 07 月 25 日 | | --- | --- | | 收盘价（港币） | 6.09 | | 恒生中国企业指数 | 9150.49 | | 52 周最高/最低（港币） | 6.48/4.06 | | H 股市值（亿港币） | 21,705.14 | | 流通 H 股（百万股） | 86,794.04 | | 汇率（人民币/港币） | 1.0991 | 一年内股价与基准指数对比走势： -5% 45% 95% HSCEI 工商银行 资料来源：Bloomberg 证券分析师 郑庆明 A0230519090001 zhengqm@swsresearch.com 林颖颖 A0230522070004 linyy@swsresearch.com 冯思远 A0230522090005 fengsy@swsresearch.com 李禹昊 A0230525070004 liyh2@swsresearch.com 联系人 李禹昊 (8621)23297818× liyh2@swsresearch.com ...