Sunday, September 1, 2013

Agricultural Bank of China : Leading earnings from laggard (DBSV)

Agricultural Bank of China
BUY HK$3.29
HSI : 21,525
Price Target : 12-Month HK$4.63 (Prev HK$4.59)
Leading earnings from laggard

Similar to other banks, 2Q earnings beat forecasts
Unlike other banks, we have more faith in ABC’s earnings sustainability
Capital remains borderline but we do not foresee equity dilution risk
Reiterate BUY for this non-consensus top pick

Earnings beat estimates like other banks. Like most Hshare banks, ABC reported upbeat 2Q13 net profit figures. The bank’s 2Q13 net profit gained 22% to Rmb45.3bn, and beat our estimates by 12% and a Bloomberg survey by 8%. ABC’s 1H13 net profit made up 57.5% of consensus full year forecast. Key positive surprises were fees, cost efficiency, and credit costs. Capital was the only blemish in this set of results, as ABC’s core T1 CAR and T1 CAR remain lower than Big 4 peers at 9.11%.

Unlike other banks, sustainability is not an issue. Unlike other H-share banks, ABC’s earnings momentum should be sustainable. We do not foresee a spike in future credit costs from 1H13’s 67bps, as ABC’s < 90 day overdue loans only edged up 3% hoh during 1H13. The bank’s NPL amount was largely flat during 1H13, with no substantial write offs.

Reiterate BUY. ABC is our non-consensus pick. We like the bank’s smaller exposure to Eastern China and nonstandard WMPs. ABC is also a laggard, due to stake disposal by Capital Group and relative capital weakness vs. the other Big 4 banks. We don’t foresee equity raising risk, however, even after assuming structural ROE declines in the longer run. We reiterate our BUY call, with slight increases in our EPS forecasts and TP. We value ABC at HK$4.63 (1.36x FY13F P/BV), which offers 40% upside.




Source/Extract/Excerpts/来源/转贴/摘录: DBSV-Research,
Publish date: 29/08/13

No comments:

Post a Comment

Warren E. Buffett(沃伦•巴菲特)
Be fearful when others are greedy, and be greedy when others are fearful
别人贪婪时我恐惧, 别人恐惧时我贪婪
投资只需学好两门课: 一,是如何给企业估值,二,是如何看待股市波动
吉姆·罗杰斯(Jim Rogers)
“错过时机”胜于“搞错对象”:不会全军覆没!”
做自己熟悉的事,等到发现大好机会才投钱下去

乔治·索罗斯(George Soros)

“犯错误并没有什么好羞耻的,只有知错不改才是耻辱。”

如果操作过量,即使对市场判断正确,仍会一败涂地。

李驰(中国巴菲特)
高估期间, 卖对, 不卖也对, 买是错的。
低估期间, 买对, 不买也是对, 卖是错的。

Tan Teng Boo


There’s no such thing as defensive stocks.Every stock can be defensive depending on what price you pay for it and what value you get,
冷眼(冯时能)投资概念
“买股票就是买公司的股份,买股份就是与陌生人合股做生意”。
合股做生意,则公司股份的业绩高于一切,而股票的价值决定于盈利。
价值是本,价格是末,故公司比股市重要百倍。
曹仁超-香港股神/港股明灯
1.有智慧,不如趁势
2.止损不止盈
成功者所以成功,是因为不怕失败!失败者所以失败,是失败后不再尝试!
曾淵滄-散户明灯
每逢灾难就是机会,而是在灾难发生时贱价买股票,然后放在一边,耐性地等灾难结束
  • Selected Indexes 52 week range

  • Margin of Safety

    Investment Clock

    World's First Interactive Investment Clock