Industrial Bank Co., Ltd. (601166) Report Analysis
Corporate Events
Industrial Bank Co., Ltd. (SHSE:601166) agreed to acquire Synnex Investments (China) Ltd for CNY 100 million.
2022-05-06 00:00:00
Industrial Bank Co., Ltd. (SHSE:601166) agreed to acquire Synnex Investments (China) Ltd for CNY 100 million on May 6, 2022.
Tenet Fintech Group Inc. Signs Partnership Agreement with the Industrial Bank Co. Ltd. to Allow Members of Tenet's Chinese Business Hub to Open Bank Accounts At CIB Linked to Their Business Hub Accounts
2022-04-13 12:07:00
Tenet Fintech Group Inc. announced that it has signed a partnership agreement with the Industrial Bank Co. Ltd. to allow members of Tenet's Chinese Business Hub to open bank accounts at CIB linked to their Business Hub accounts. The real bank accounts at CIB will provide Business HubTM clients with an alternative to Tenet's offering of virtual bank accounts on the China UnionPay network. The CIB accounts are meant to accommodate larger clients, such as commodities traders, that have been relying on the Hub's services to finance their purchase orders, alleviate their cash flow issues and also have cash settlement needs that are not available through the virtual bank accounts. Just like with the virtual bank accounts, Tenet will earn service fees and have administrative oversight of the CIB accounts, which should provide an additional layer of comfort to Business HubTM partnering financial institutions, including CIB, when it comes to extending credit to Hub members that have such bank accounts.
Industrial Bank Co., Ltd., 1.035 (CNY), Cash Dividend, Jun-16-2022
2022-03-24 00:00:00
Industrial Bank Co., Ltd., 1.035 (CNY), Cash Dividend, Jun-16-2022
SVOLT Energy Technology Co., Ltd. announced that it has received CNY 6 billion in funding from a group of investors
2021-12-11 00:00:00
SVOLT Energy Technology Co., Ltd announced that it has raised CNY 6 billion in series B+ round of funding on December 11, 2021. The transaction included participation from CDH Investment Management Company Limited, China Mobile Innovative Business Fund (Shenzhen) Partnership; a fund managed by China Mobile State Development & Investment Management Company Limited, Changzhou Xingyu Automotive Lighting Systems Co.,Ltd, Taikang Asset Management Co., Ltd., Pre-IPO Capital Partners Ltd., PICC Capital Investment Management Co. Ltd., Sichuan Energy Investment Development Co., Ltd, Han's Laser Technology Industry Group Co., Ltd, China Mobile Capital Holding Co., Ltd and Industrial Bank Co., Ltd.
Industrial Bank Co., Ltd., Special/Extraordinary Shareholders Meeting, Nov 15, 2021
2021-11-15 00:00:00
Industrial Bank Co., Ltd., Special/Extraordinary Shareholders Meeting, Nov 15, 2021.
Industrial Bank Co., Ltd. Presents at 12th Annual China Investment Conference, Nov-01-2021
2021-10-29 18:11:00
Industrial Bank Co., Ltd. Presents at 12th Annual China Investment Conference, Nov-01-2021 . Venue: Shenzhen, China.
Fundamental Summary
When Industrial released its Q1 data on 2022-04-28, many of the results seemed negative and concerning. its growth and income factors look concerning individually, but the holistic financial picture was more impressive. In statistics, this is called the Simpson Paradox (https://www.britannica.com/topic/Simpsons-paradox). With all the factors considered, Industrial received an overall score of 80, which translates to a BUY recommendation.
Industrial reported earnings results for the first quarter ended March 31, 2022. For the first quarter, the company reported net interest income was CNY 37,775 million compared to CNY 36,877 million a year ago. Net income was CNY 27,578 million compared to CNY 23,853 million a year ago. Basic earnings per share from continuing operations was CNY 1.33 compared to CNY 1.15 a year ago. Diluted earnings per share from continuing operations was CNY 1.23 compared to CNY 1.15 a year ago.
Business Description
Industrial provides banking services in the People’s Republic of China. The company’s banking services include accepting deposits from the public; granting short-term, medium-term, and long-term loans; domestic and overseas settlement services; issuance of discount and financial bonds; acceptance bills and notes; agency issue and encashment; underwriting and trading of government bonds and debentures; trading of financial bonds; agency trading and trading of marketable securities except stock; asset custody business; and inter-bank lending and borrowings. It also trades in, settles, and sells foreign exchange, as well as provides bank cards; agency trading services; letters of credit and letters of guarantee; remittance and insurance agent services; safety deposit box services; financial advisory services; credit investigation, advisory, and attestation services; and other banking services. In addition, the company, through its subsidiaries, is involved in finance leasing, trust, fund raising and marketing, asset management, consumer finance, equity investment, and industrial investment; investment management, advisory, and consulting; and financial, business, and enterprise management consulting; financial data processing, commodity and financial futures brokerage, futures investment consulting, and economic information consulting; application software development and operational, and system integration services. Further, it engages in investment and assets management; acquisition, transfer, and disposal of bad debts of financial and non-financial institutions; issuance of wealth management products; wealth management consulting and advisory services; and other banking activities. Additionally, the company offers debit and credit card, and internet and mobile banking services. Industrial was founded in 1988 and is headquartered in Fuzhou, the People’s Republic of China.
Sector Overview
Industrial is included in the Banks according to GICS (global industry classification standard). The Banks industry, which is in the Financials sector, includes Diversified & Regional Banks whose operations focus on conventional banking, retail banking, and lending to SMEs (small and medium enterprises). Industrial's industry and sector affiliation are expected to negatively affect their likelihood to overperform the market in the upcoming period, as other sectors appear more likely to benefit from the macroeconomic environment we see now.
Fundamental Highlights
| Parameter | Value | Change | Score | |
|---|---|---|---|---|
| Return on Equity | 12.7 | 0.3% | 73 | |
| Net Cashflow | -288,097.0 | -53.3% | 81 | |
| Capital Expenditure | -5,720.0 | -16.6% | 47 | |
| Free Cashflow | -16.8 | 11.8% | 56 |
* All values are TTM
The below chart reflects Industrial's birds-eye view on its performance with respect to its peers, the company's fillings as reported or to a similar industry, market cap, and country of origin. While Industrial's peer average final assessment score stands on 75.0, Industrial's score is 80.
- 601166
- Peers average
Technical Analysis
When trying to optimize the timing of an investment, it's critical to analyze whether the stock looks overbought or oversold, and in which direction the momentum is moving. Industrial's stock is now priced above its 5-day, but below its 50-day and 200-day moving average, while its MACD (moving average convergence divergence) indicates that the stock's price movement momentum is weakening. Historically, this is a positive setup in the near-term. Meanwhile, looking at the Stochastic Oscillator and RSI (relative strength index), Industrial's stock indicates that it's likely oversold. Overall, these technical indicators signal negative momentum. Therefore, this stock received a cumulative TA (technical analysis) score of 52.
5D MA
19.28
50D MA
19.99
200D MA
19.92
MACD
-0.17
RSI
2.66
STOCH
22.84
Balance Sheet Analysis
Industrial appears likely to maintain its strong balance sheet metrics and momentum going forward. Industrial reported a positive trendline in their cash and cash equivalents metrics. Specifically, they reported that cash and cash equivalents were 402160.0, representing 51.9% change from the last report. This impressive growth, specifically in contrast to their industry peers' performance, should support an upswing in the company's stock price. The company's cash and cash equivalents movement, therefore, received a grade of 90. Also, Industrial publishes solid book value factor metrics in this report. Price to book ratio (P/B) now sits at 0.6 and represents a -1.3% change from the previous report. These book value factor numbers show that management has been prudent in focusing on efficient growth. We believe the stock price has room to grow to reflect its intrinsic value accurately. Therefore, its book value factors earned a score of 82. That said, one metric, Equity, stood out as particularly concerning. Industrial published concerning equity metrics for this filing. In the current report, equity stood at 655055.0, which represents a 4.3% change from the last report. This parameter often affects companies in the same industry and market capitalization by up to 7.1%. Their equity metrics appear unremarkable relative to their peers. Therefore, their equity movement component earned a score of 68. Therefore, its balance sheet earned a grade of 85.
| Parameter | Value | Change | Score |
|---|---|---|---|
| Assets | 8,822,450.0 | 2.6% | 80 |
| Liabilities | 8,101,316.0 | 2.4% | 74 |
| Price to Book | 0.6 | -1.3% | 82 |
| Cash & Equivalents | 402,160.0 | 51.9% | 90 |
| Equity | 655,055.0 | 4.3% | 68 |
The below chart describes Industrial's performance as reflected on its balance sheet with respect to its peers. While Industrial received a balance sheet score of 85, the average of its peers stands on 79.0.
- 601166
- Peers average
| Name | Market Cap | Liabilities Movement | Asset Change | Equity/Intangibles Adjustments | Cash & Equivalents | Book Value Momentum | Balance Sheet | mc_sort | Hidden |
|---|---|---|---|---|---|---|---|---|---|
| China Merchants Bank Co., Ltd. | 1.1T | 72 | 81 | 68 | 37 | 84 | 77 | 0 | 1 |
| Shanghai Pudong Development Bank Co., Ltd. | 233.9B | 74 | 70 | 55 | 51 | 76 | 72 | 1 | 1 |
| China Everbright Bank Company Limited | 160.4B | 89 | 44 | 69 | 54 | 76 | 76 | 2 | 1 |
| China Minsheng Banking Corp., Ltd. | 150.8B | 80 | 45 | 69 | 90 | 77 | 81 | 3 | 1 |
| Bank of Nanjing Co., Ltd. | 111.2B | 81 | 51 | 51 | 89 | 82 | 82 | 4 | 1 |
| Bank of Jiangsu Co., Ltd. | 100.3B | 87 | 85 | 55 | 92 | 78 | 83 | 5 | 1 |
| Bank of Beijing Co., Ltd. | 95.8B | 64 | 63 | 68 | 67 | 90 | 84 | 6 | 1 |
| Bank of Shanghai Co., Ltd. | 92.8B | 83 | 62 | 54 | 90 | 90 | 90 | 7 | 1 |
| Bank of Hangzhou Co., Ltd. | 85.0B | 82 | 63 | 54 | 87 | 79 | 81 | 8 | 1 |
| Hua Xia Bank Co., Limited | 79.1B | 79 | 49 | 69 | 89 | 76 | 81 | 9 | 1 |
| Bank of Chengdu Co., Ltd. | 61.3B | 83 | 76 | 68 | 82 | 83 | 86 | 10 | 1 |
| Bank of Changsha Co., Ltd. | 31.4B | 74 | 63 | 69 | 72 | 79 | 79 | 11 | 1 |
| QILU BANK CO., LTD. | 22.4B | 80 | 59 | 95 | 77 | 89 | 93 | 12 | 1 |
| Bank of Guiyang Co.,Ltd. | 21.2B | 74 | 61 | 69 | 77 | 80 | 80 | 13 | 1 |
| Jiangsu Changshu Rural Commercial Bank Co., Ltd. | 20.6B | 85 | 81 | 69 | 60 | 81 | 82 | 14 | 1 |
| Bank of Xi'an Co.,Ltd. | 16.2B | 81 | 55 | 67 | 97 | 75 | 80 | 15 | 1 |
| Xiamen Bank Co., Ltd. | 15.6B | 86 | 66 | 69 | 84 | 78 | 83 | 16 | 1 |
| Zhejiang Shaoxing RuiFeng Rural Commercial Bank Co.,Ltd | 12.2B | 83 | 72 | 69 | 81 | 79 | 83 | 17 | 1 |
| Jiangsu Zijin Rural Commercial Bank Co.,Ltd | 10.5B | 41 | 80 | 56 | 95 | 80 | 77 | 18 | 1 |
| Wuxi Rural Commercial Bank Co.,Ltd | 10.3B | 66 | 72 | 55 | 62 | 78 | 73 | 19 | 1 |
| Jiangsu Suzhou Rural Commercial Bank Co., Ltd | 9.0B | 78 | 77 | 55 | 60 | 75 | 74 | 20 | 1 |
| Ping An Bank Co., Ltd. | 281.2B | 79 | 78 | 69 | 88 | 79 | 83 | 21 | 1 |
| Bank of Ningbo Co., Ltd. | 225.7B | 86 | 51 | 68 | 97 | 84 | 89 | 22 | 1 |
| Bank of Suzhou Co., Ltd. | 22.1B | 91 | 82 | 54 | 97 | 89 | 92 | 23 | 1 |
| Qingdao Rural Commercial Bank Co., Ltd. | 18.4B | 66 | 68 | 55 | 72 | 77 | 74 | 24 | 1 |
| Jiangsu Zhangjiagang Rural Commercial Bank Co., Ltd | 11.1B | 84 | 53 | 55 | 65 | 79 | 77 | 25 | 1 |
| Jiangsu Jiangyin Rural Commercial Bank Co.,LTD. | 9.3B | 76 | 66 | 69 | 76 | 74 | 77 | 26 | 1 |
Income Statement Analysis
Industrial appears likely to maintain its strong income statement metrics, especially Return Factors. Industrial's reported return on equity (ROE) ratio was 12.7, representing a change of 0.3%. These numbers show that management has successfully encouraged growth while managing ROE and ROA metrics, especially relative to their peers. Therefore, its return factors component earned a score of 73. That said, one metric, Revenue Efficiency, stood out as strongly negative. Industrial reported discouraging numbers for its revenue efficiency. As of the current filing, they were reported as 161941.0 and represented 5.3% change from the previous period. This metric might have a 2.3 percent impact on companies in the same industry and with the same market capitalization. Their revenue efficiency, specifically in contrast to their industry peers', isn't encouraging. Its revenue efficiency, therefore, received a grade of 48. their income statement received an overall score of 67.
| Parameter | Value | Change | Score |
|---|---|---|---|
| Total Revenues | 161,941.0 | 5.3% | 48 |
| Return on Equity | 12.7 | 0.3% | 73 |
The below chart describes Industrial's performance as reflected on its income statement with respect to its peers. While Industrial received a income statement score of 67 , the average of its peers stands on 67.0.
- 601166
- Peers average
Cash Flow Analysis
Industrial appears likely to maintain its strong cash flow metrics and momentum going forward. Industrial's strong net cash flow numbers, which were -288097.0 in this filing, showed a -53.3% change from the last period. The company is headed in the right direction regarding business priorities, exhibiting prudent net cash flow management and growth. Hence, its net cash flow earned a score of 81. Also, Free cash flow numbers published by Industrial were -16.8, which was a 11.8% change from the previous filing. Companies in the same industry and market capitalization are typically affected by this parameter by up to 9.3%. These free cash flow numbers show that management has executed well while generating cash flow and encouraging growth. Consequently, their free cash flow movement received a grade of 56. On the other hand, Capital Expenditure, jumped out as looking rather underwhelming. Industrial's management did not a remarkable job this period managing capital expenditures (CapEx). In terms of the raw numbers, CapEx was reported as -5720.0, which represents a -16.6% change from the last period. The company's disappointing CapEx growth is expected to stunt the momentum they hoped for this period. Its CapEx movement, therefore, received a grade of 47. Therefore, we scored its cash flow a 66.
| Parameter | Value | Change | Score |
|---|---|---|---|
| Net Cashflow | -288,097.0 | -53.3% | 81 |
| Capital Expenditure | -5,720.0 | -16.6% | 47 |
| Free Cashflow | -16.8 | 11.8% | 56 |
The below chart describes Industrial's performance as reflected on its cash flow with respect to its peers. While Industrial received a cash flow score of 66, the average of its peers stands on 67.0.
- 601166
- Peers average
This report is intended for general guidance and information purposes only and under no circumstances is tailored to a specific factor or variable related to its reader or intended to be used or considered as financial or investment advice, a solicitation of any offer, a recommendation, or an offer to sell or buy any securities or other form of a financial asset. For the full disclaimer, click here.