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<Research>JPM: STANCHART Valuation Yet to Reflect Long-term RoTE Target; Rating Overweight
Recommend 13 Positive 7 Negative 10 |
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STANCHART (02888.HK) set a 2028 RoTE target of above 15%, broadly in line with JP Morgan's forecast of 15.5%. As market expectations have already risen following the bank's strong 1Q results, the broker forecast the share price reaction in the near term to be relatively muted. STANCHART's sustainable growth plan is expected to drive double-digit EPS CAGR between 2025 and 2028. RoTE is projected to expand from 11.9% in 2025 to above 15% in 2028, and further improve to about 18% by 2030. Under the plan, STANCHART targets revenue CAGR of 5-7% from 2025 to 2028. On capital management, the bank maintained its CET1 ratio target range at 13-14%, and set a dividend payout ratio of no less than 30%. JP Morgan believed STANCHART's current valuation, equivalent to 1.2x 2026E P/B, has yet to reflect its long-term return targets. However, the broker noted that the bank's capital return targets may be slightly disappointing. JP Morgan reiterated its Overweight rating on STANCHART with TP kept at HKD275. Auto-translated by AI This article was automatically translated by AI, the original language version should be considered the authoritative version. AASTOCKS.com Limited does not guarantee its accuracy or completeness and accepts no liability for any damages or losses arising from the use of this translation. More Details
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