Jingwu Financial News | HTSC Research pointed out that FE HORIZON (03360) is a domestic leader in financing leasing, while also balancing industrial Operation. Financing leasing is the main Business, contributing about 60% of revenue and 80% of profit in 1H24, with a strong interest margin resilience, maintained at 4.4-4.7% since 2022. The stabilized and improving macro environment is expected to drive growth in interest-earning asset scale. Long-term, the penetration rate and concentration of China's leasing industry will continue to rise. It is projected that year-on-year changes in interest-earning assets will be -1.0%/3.0%/2.0% for 2024/2025/2026. Considering the profit elasticity of operational leverage, the bank anticipates that growth in asset scale will significantly boost ROE.

The bank noted that the company's high dividend yield is also worthy of attention, expecting a dividend yield of about 12% in 2025. Based on the stabilization and recovery of ROE or high Shareholder return, it is initiating coverage on FE HORIZON with a 'Buy' rating and a Target Price of 6.4 Hong Kong dollars.