China Merchants Bank Co Ltd Class A

600036: XSHG (CHN)

Morningstar Rating for Stocks	Fair Value	Economic Moat	Capital Allocation
	¥92.00	Njyqrxd	Jfpdlnjzj

China Merchants Bank: Lowering Valuation as Fee Income and Margin Pressure Dampen Outlook

Iris Tan

Aug 28, 2023

We lower our fair value estimate on China Merchants Bank, or CMB, to HKD 54 from HKD 64 per H-share and CNY 50 from CNY 55 per A-share after we reduce our 2023 net interest margin, or NIM, forecasts by 3 basis points and 2023 fee income growth by 7 percentage points. We push back our original assumptions for consumption growth to stabilize in China in second-half 2023 and incorporate a less optimistic outlook for recovery in consumer credits and the wealth management business as property developer credit risks rise.

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