Financials & FinTech research, Galliano’s Financials Research

Victor Galliano

Financials & FinTech research

Financials & FinTech, EM & Developed Markets

Galliano’s Financials Research

Galliano's Financials Research provides fundamental research in Emerging Markets financials, including FinTech, as well as financials in select Developed Markets.

The investment style applied is generally value oriented, although Growth At Reasonable Price (GARP) strategies can also be used where appropriate. 

Our investment research approach aim is often contrarian, looking to capitalise on overly sceptical or optimistic consensus views. In terms of valuation techniques, the focus is on PBV ratio to ROE, PE multiples and dividend yield, as well as the application of PEG ratios and, where appropriate, Sum of the Parts (SOTP) valuations.

Thematic (Sector/Industry)

<ul>
<li>Chinese banks remain broadly out of favour due to growth and property sector concerns; we see some value opportunities</li>
<li>We like PingAn Bank, in particular, for its attractive valuations, compelling PEG ratio and potential for higher returns; we also remain positive on CCB</li>
<li>We remain negative on China Minsheng due to its low ROE, poor delinquency and NPL coverage</li>
</ul>


Chinese banks remain broadly out of favour due to growth and property sector concerns; we see some value opportunities
We like PingAn Bank, in particular, for its attractive valuations, compelling PEG ratio and potential for higher returns; we also remain positive on CCB
We remain negative on China Minsheng due to its low ROE, poor delinquency and NPL coverage


China Banks Screener; PingAn Bank Is Our Top Pick, Followed by CCB

Equity Bottom-Up

China Construction Bank H / Equity Bottom-Up

<ul>
<li>Chinese banks are out of favour given the China GDP growth concerns and property sector headwinds; yet we see selective opportunities in the stronger, higher return banks</li>
<li>Our core picks are unchanged, with the core holding being CCB, and also PSBC; both have healthy credit quality and coverage, double digit ROEs and are attractive on valuations</li>
<li>We remain negative on China Minsheng due to its low ROE, poor delinquency and NPL coverage, and its relatively high exposures to real estate relative to its peers</li>
</ul>


Chinese banks are out of favour given the China GDP growth concerns and property sector headwinds; yet we see selective opportunities in the stronger, higher return banks
Our core picks are unchanged, with the core holding being CCB, and also PSBC; both have healthy credit quality and coverage, double digit ROEs and are attractive on valuations
We remain negative on China Minsheng due to its low ROE, poor delinquency and NPL coverage, and its relatively high exposures to real estate relative to its peers


China Banks – Stick with Quality at Attractive Valuations

Articles from Caixin Global, Caixin Global

Caixin Global

Articles from Caixin Global

Caixin is a media group dedicated to providing financial and business news through periodicals, online content, mobile apps, conferences, books and TV/video programs. Caixin aims to blaze a trail that helps traditional media prosper in the new media age through integrated multimedia platforms.

News from Caixin

Cross Asset Strategy

<ul><li>Cover Story: China’s climate envoy says nations must deliver on their commitments (Part 1)</li><li>Sinopec Shanghai plant blaze leaves one dead, one injured</li><li>In Depth: Trouble at crypto hedge fund sparks contagion fears</li></ul>

Cover Story: China’s climate envoy says nations must deliver on their commitments (Part 1)Sinopec Shanghai plant blaze leaves one dead, one injuredIn Depth: Trouble at crypto hedge fund sparks contagion fears

CX Daily: Trouble at Crypto Hedge Fund Sparks Contagion Fears

<ul>
<li>CCB is our preferred pick, given its attractive valuations, strong capital adequacy, healthy ROE and sound credit quality; CCB’s real estate exposure is limited and it sector delinquency is low</li>
<li>We also pick PSBC for its good value, its attractive PEG ratio and healthy credit quality and coverage; its real estate exposure, and its related delinquency, are both very low</li>
<li>We are negative on China Minsheng due to its low ROE, poor delinquency and NPL coverage, its high exposures to real estate relative to its peers and fast rising delinquency</li>
</ul>


CCB is our preferred pick, given its attractive valuations, strong capital adequacy, healthy ROE and sound credit quality; CCB’s real estate exposure is limited and it sector delinquency is low
We also pick PSBC for its good value, its attractive PEG ratio and healthy credit quality and coverage; its real estate exposure, and its related delinquency, are both very low
We are negative on China Minsheng due to its low ROE, poor delinquency and NPL coverage, its high exposures to real estate relative to its peers and fast rising delinquency


China Banks – 4Q21 KPIs Support Our Stock Picks

Silver Point

Thomas J. Monaco

Silver Point is a boutique research firm that focuses on the broader financial services sector, with a particular focus on troubled institutions globally. 

Asia Ex Japan

<ul>
<li>In a move to shore up liquidity, but not to repay debt, Evergrande has sold stakes and "right to debt" in four development projects to SOEs at “fire sale” prices;</li>
<li>Only USD 47.2 bn in liabilities to go Chairman Hui, but didn’t you say less than two weeks ago “no fire sales”?; and    </li>
<li>
Municipalities, investors, and CINDA are picking off Evergrande assets on the cheap as well.    </li>
</ul>


In a move to shore up liquidity, but not to repay debt, Evergrande has sold stakes and "right to debt" in four development projects to SOEs at “fire sale” prices;
Only USD 47.2 bn in liabilities to go Chairman Hui, but didn’t you say less than two weeks ago “no fire sales”?; and    

Municipalities, investors, and CINDA are picking off Evergrande assets on the cheap as well.    


China Evergrande Group – Drop In The Bucket

China

China Minsheng Banking Corp., Ltd. operates in commercial banking businesses. The Bank provides deposit, loan, settlement, discount, financial bond issuance, government bond underwriting and trading, letter of credit, bank guarantee, and other related financial services.

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China Minsheng Banking H (1988 HK)

China Banks Screener; PingAn Bank Is Our Top Pick, Followed by CCB

We like PingAn Bank for its attractive valuations, compelling PEG ratio and potential for higher returns, we also remain positive on CCB; avoid...

Victor Galliano

China Banks – Stick with Quality at Attractive Valuations

In this challenging environment, we recommend investors to stick with quality and value in China banks, CCB & PSBC are our picks; avoid China...

Victor Galliano

CX Daily: Trouble at Crypto Hedge Fund Sparks Contagion Fears

Cover Story: China’s climate envoy says nations must deliver on their commitments (Part 1). Sinopec Shanghai plant blaze leaves one dead, one injured

Caixin Global

China Banks – 4Q21 KPIs Support Our Stock Picks

CCB is our preferred pick with the best " all rounder" attributes; we also like PSBC for its good value and solid credit quality; China Minsheng...

Victor Galliano

China Evergrande Group – Drop In The Bucket

EVERGRANDE: In a move to shore up liquidity but not repay debt, Evergrande has sold stakes in four development projects to SOEs at “fire sale”...

Thomas J. Monaco

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)