Jinwu Financial News | Guotai Junan released a research report showing that the net revenue of CICC (03908)'s investment business in the first quarter was -48.95% of the year-on-year to 1,847 billion yuan, accounting for -75.85% of the adjusted revenue increase, putting pressure on performance. The main reason for the decline in business is the year-on-year decline in return on investment compounded by a contraction in the scale of OTC derivatives and other businesses under volatile market conditions.
According to the bank, the State Council stated that it will concentrate its efforts on building a “national team” for the financial industry to promote the strengthening and improvement of large state-owned financial enterprises. It is expected that supply-side reforms in the industry will accelerate, the efficiency of the use of the company's capital will be outstanding, the specialization advantages of various businesses will be continuously consolidated, and it is expected that development will exceed expectations through endogenous growth and extrinsic mergers and acquisitions.
The bank maintained the company's profit forecast for 2024-2026 at an EPS of 1.33/1.50 yuan/1.63 yuan, and maintained a target price of HK$19.85, corresponding to 13.51xPe and 0.93xPb in 2024, maintaining an “gain” rating.