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Macquarie MarQuee Ideas
Adding China Minsheng Bank,
Removing CITIC Pacific
A more positive outlook for China banking leads us to add
China Minsheng Bank to the Buy list
We are adding China Minsheng Bank to the Asia MarQuee Buy list following
strong FY10 results and post our recent earnings upgrade. We see China
Minsheng as a restructuring story and expect a re-rating by consensus as we
believe MSB is the best positioned China bank due to its prudent business
strategy and advantage in niche markets.
Our analyst Victor Wang believes Minsheng‟s business reform will continue to
pay off with a 31% 2010-13E profit CAGR, driven mainly by strong margin
expansion, improving fee contribution, as well as benign asset quality. MSB is
Victor‟s top pick in the China banking sector and also fits with our strategist‟s
Michael Kurtz view on the China banking sector.
China Minsheng Bank (1988 HK, HK$7.59, Outperform, TP: HK$12.20, Victor
Wang)
Removing CITIC Pacific from the Buy list
At the same time, we are removing CITIC Pacific from the Buy list after a solid
run in the share price and, as we transfer coverage to Janet Lewis, our
conviction among Hong Kong/China names shifts in favour of China banks and
in particular the restructuring play of China Minsheng. CITIC Pacific has been a
stellar performer in the Buy list, returning 27.8% since 17 December against the
Hang Seng, which is up 5.7% in the same period.
CITIC Pacific (267 HK, HK$23.85, Outperform, TP: HK$28.80)
About China Minsheng Bank
China Minsheng Banking provides financial services through four main business
lines – corporate banking, retail banking, treasury and e-banking businesses.
The firm is also involved in the areas of investments and electronic banking. It
operates its businesses mainly in northern, eastern and southern China, was
founded in January 1996 and is headquartered in Beijing. (Factset)
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
Macquarie MarQuee Ideas
Adding China Minsheng Bank,
Removing CITIC Pacific
A more positive outlook for China banking leads us to add
China Minsheng Bank to the Buy list
We are adding China Minsheng Bank to the Asia MarQuee Buy list following
strong FY10 results and post our recent earnings upgrade. We see China
Minsheng as a restructuring story and expect a re-rating by consensus as we
believe MSB is the best positioned China bank due to its prudent business
strategy and advantage in niche markets.
Our analyst Victor Wang believes Minsheng‟s business reform will continue to
pay off with a 31% 2010-13E profit CAGR, driven mainly by strong margin
expansion, improving fee contribution, as well as benign asset quality. MSB is
Victor‟s top pick in the China banking sector and also fits with our strategist‟s
Michael Kurtz view on the China banking sector.
China Minsheng Bank (1988 HK, HK$7.59, Outperform, TP: HK$12.20, Victor
Wang)
Removing CITIC Pacific from the Buy list
At the same time, we are removing CITIC Pacific from the Buy list after a solid
run in the share price and, as we transfer coverage to Janet Lewis, our
conviction among Hong Kong/China names shifts in favour of China banks and
in particular the restructuring play of China Minsheng. CITIC Pacific has been a
stellar performer in the Buy list, returning 27.8% since 17 December against the
Hang Seng, which is up 5.7% in the same period.
CITIC Pacific (267 HK, HK$23.85, Outperform, TP: HK$28.80)
About China Minsheng Bank
China Minsheng Banking provides financial services through four main business
lines – corporate banking, retail banking, treasury and e-banking businesses.
The firm is also involved in the areas of investments and electronic banking. It
operates its businesses mainly in northern, eastern and southern China, was
founded in January 1996 and is headquartered in Beijing. (Factset)
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