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Detailed Interpretation of CCB (601939) 2019 Interim Report: Steady Operation, High ROE Continued
Investment Highlights Interim Report Highlights: 1. Stable growth rate, 1H19 return to mother’s net profit for ten years +4.9%: Revenue has remained on the high base for the same period last year for several years.7% growth rate; PPOP exceeds +7.2%.2. Asset quality remains stable: The non-performing rate and the non-performing net generation rate have declined steadily.The company’s non-performing interest rate in the second quarter was 1.43%, down 3bp from the first quarter.The net annual generation rate of bad single season is 0.67%, a decrease of 1bp from the previous quarter, and the absolute value remained at a low level.3. The net handling fee has maintained an annual growth of + 11% in both countries. The pick-up in handling fee growth is mainly supported by agency sales, bank card handling fees, financial management and custody services.Insufficient interim reports: 1. Net interest margin decreased slightly by 4bp to 2.08%.The narrowing of interest margin is mainly dragged down by the increase in asset-side yields, and at the same time, the interest rate is down longer.2. Overdue rate. The proportion of overdue badness increased slightly earlier, and the overdue rate increased slightly by 15bp to 1 from the beginning.43%, the proportion of overdue bad increased by 12 units to 100% in the early and early stages, and overdue was still a 100% replacement of bad. 1H19 return to net profit continued to rise: the revenue has maintained for several years on the basis of a high base in the same period last year.Growth rate of 7%; PPOP +7 per year under the support of improved management efficiency.2%.1Q19-1H19 revenue, PPOP, net profit attributable to mother or growth rate were 8 respectively.4% / 6.7%, 8.3% / 7.2%, 4.twenty four.9%. 1H19 performance increase: positive contribution performance factors are scale, non-interest, cost, and growth. The negative contribution factor is the interest margin, provision.Taking a closer look at the changes in the contribution of various factors, the marginal contribution to performance has been improved: 1. The scale growth has continued to expand, and the positive contribution to performance has increased.2. Management efficiency has been improved, and the contribution of expenses to performance has changed from negative to positive.3. Provisions accrued speed density and weakened negative contribution to performance.4. 重庆耍耍网 The increase in the allocation of tax-exempt assets such as local debts has contributed positively to profits.The marginal contribution decays: 1. The interest margin narrows, and the contribution to profit decline further weakens.2. The positive contribution of non-interest income is weaker than the margin in the first quarter. Investment suggestion: The company 2019E, 2020E PB 0.84X / 0.77X; PE 6.64X / 6.42X (raw row PB 0.7X / 0.64X; PE 6.01X / 5.75X), China Construction Bank has excellent management, strong innovation ability, and excellent indicators. In recent years, it has increased the promotion of science and technology to create a first-class bank group. We are optimistic about its continued competitiveness. The company is cheaper, has a high ROE and is highly sustainable.Is the bank we continue to recommend. Risk warning: The economic growth exceeds expectations, and the company’s operation is worse than expected.