Jingu Finance News | China Securities Co.,Ltd.research reports pointed out that HSBC Holdings (00005) this organizational structure adjustment fully reflects HSBC's two major local markets of "Hong Kong + United Kingdom," and the two core strategic layouts of "global trade banks + global wealth management." In terms of impact, this structural adjustment reinforces the importance and autonomy of the two major local markets, reduces process complexity; at the same time, it breaks regional and customer group boundaries, strengthens the integrated layout of corporate lines and trade banks, and is conducive to HSBC more fully responding to the current global trade and supply chain decentralization trends, and better leveraging the core advantages of global banks. With the recovery of global crediting demand and the progress of industrial transfer process, the continuously increasing scale of trade and investment can effectively hedge against interest rate fluctuations. It is expected that HSBC Holdings will smoothly navigate through the current interest rate reduction cycle in Europe and the United States, demonstrating strong stability in revenue growth, ROTE, dividend return, etc., effectively breaking free from the long-term constraints of interest rate cycle varieties, and achieving continuous and stable valuation growth.
The bank predicts that the revenue growth rates for 2024-2026 will be -0.5%, 1.1%, 1.6%, and the profit growth rates will be 4.6%, 0.4%, 0.3% respectively. In 2024, the cash dividend payout ratio will be 67% (including a one-time special dividend of 17%), and if the share buyback scale is $9 billion, the total shareholder cash return rate will be 106%, corresponding to a total dividend yield of 15.9% based on the current stock price, with significant high dividend characteristics. It is expected that the ROTE will remain around 15% from 2024 to 2026, with strong support from performance, and the dividend level will be stable and sustainable. The current valuation is 1.02 times the 2024 P/TB (0.96 times the 2024 P/B), maintaining a buy rating and being the top recommendation in the banking sector.
