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<Research> CICC Raises TP of BOC Hong Kong (02388.HK) to HKD45.1; Special Shareholder Returns Expected to Materialize in 1HYY
Recommend 5 Positive 9 Negative 5 |
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CICC's research report indicates that BOC Hong Kong (02388.HK) announced its 2025 annual results, with revenue increasing by 8.1% year-on-year and net profit attributable to shareholders rising by 4.9% year-on-year. Revenue for the fourth quarter of last year increased by 13.8% year-on-year, and pre-tax profit grew by 5% year-on-year, meeting CICC's expectations. CICC introduces earnings forecasts for this year and next, projecting the company's operating income to be HKD77.3 billion and HKD78.4 billion, respectively, and net profit attributable to shareholders to be HKD40 billion and HKD40.5 billion, respectively. Considering changes in market risk appetite and earnings expectations, the target price is raised by 53% to HKD45.1, corresponding to a price-to-book ratio of 1.3x and 1.2x for this year and next, with an upward potential of 11.2%. The rating is maintained at "Outperform." The firm also anticipates that BOC Hong Kong's net fee income will maintain a double-digit year-on-year growth rate in 2026, with credit costs remaining stable at about 50 bps. The company disclosed that the board has, in principle, approved a shareholder return framework for 2026 to 2028, which mainly involves measures such as orderly increasing the shareholder payout ratio within the established dividend range (40% to 60%), share buybacks, and special dividends to enhance shareholder returns. These measures are expected to be implemented during the announcement of the 1HYY results. Given the company's current high valuation level, CICC judges that the probability of adopting dividend-related measures is higher, with special shareholder returns expected to materialize in the first half of this year. (hc/u) Auto-translated by third-party software This translation was auto-generated by third-party software. 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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