Investment points: the marginal improvement of 22Q3 of Xiamen Bank is significant, and the asset quality and profit growth rate are significantly higher than those of 22H1. 22Q1-Q3 's revenue increased by 15% year-on-year, and its net profit increased by 19%.
Profit growth accelerated significantly. Xiamen Bank Q3 single-quarter homing net profit increased 28.5% year-on-year increase of 15.1% compared with 22H1, leading to a year-on-year increase of nearly 20% in the first three quarters of 22 years.
Asset quality indicators are all good. The defect rate of 22Q3 Xiamen Bank has been reduced by 4bps to 0.86% from the previous month, and the attention rate is 0.68%, which is much lower than that of 22Q2 by 19bps. The provision coverage is 385.02%, a month-on-month increase in 21pct.
Convertible bonds to be issued, Xiamen Finance Bureau changed from direct shareholding to indirect shareholding. Xiamen Bank plans to issue convertible bonds of no more than 5 billion yuan to supplement core first-tier capital, which has yet to be approved by the CSRC. Due to the transfer of state-owned assets, the largest shareholder of 22Q3 Xiamen Bank has changed from Xiamen Finance Bureau to Xiamen Jinyuan Investment Group. Xiamen Jinyuan Investment Group is 100% controlled by the Finance Bureau, which has changed from direct shareholding to indirect shareholding.
Investment advice. The marginal improvement of 22Q3 profit growth and asset quality of Xiamen Bank is significant. We predict that the EPS from 2022 to 2024 will be 0.98,1.13,1.31 yuan, and the growth rate of net profit will be 19.05%, 15.98% and 15.14%. According to the DDM model (see Table 2), we get the reasonable value of RMB 7.560.According to the comparable valuation method, the 2022E PB of the company is valued at 0.75x (0.62x of the comparable company), and the corresponding reasonable value is RMB6.49RMB. Therefore, the reasonable value range is 6.49-7.56 yuan (corresponding to 2022 PE 6.64-7.73 times, peer companies corresponding to PE 4.68 times), maintaining the "better than the market" rating.
Risk hints: the solvency of enterprises has declined, asset quality has deteriorated significantly, and major changes have taken place in financial regulatory policies.