CITIC Bank's index is undervalued. Is it suitable for buying?

The CITIC Bank index has been undervalued and is not suitable for buying. The best choice is to buy growth stocks with moderate valuation, rather than junk stocks with low valuation or stocks with no prospects. Banks are most worried about the impact of profitability and epidemic situation on their asset quality. Regarding the profit-making of banks, we believe that the space for profit-making is limited. 202 1 year, the average loan interest rate decreased by 36 basis points, and the debt cost decreased by 10 basis points. According to the data recently released by the China Insurance Regulatory Commission, the net interest margin of China's banking industry has decreased by 10 basis point in the first quarter of 2020, and the narrowing of the net interest margin is expected to continue to be reflected. Since then, the net impact of the bank's net interest margin on the bank's profits is completely in the market expectation. Of course, the number of loans has also avoided a partial decline in net interest margin to some extent.

In the two sessions, the central sentence about banks is? Financial institutions and loan enterprises prosper together and encourage banks to make reasonable profits? The formulation of reasonable profit rate also includes considering the risks of the financial system. Two related notices about supplementary capital, one announcement by blue banks and insurance companies about investing in supplementary capital bonds of insurance funds banks, involve expanding the conditions for insurance funds to invest in supplementary capital bonds. It is a plan put forward by the Finance Committee Office to deepen the reform of small and medium-sized banks and supplement liquidity, further deepening the reform, while small and medium-sized banks accelerate the capital flow of small and medium-sized banks. In terms of bank asset quality, in the first quarter, although the overall NPL ratio of banks was 1.9 1%, which was 5 basis points higher than that at the end of 20 19, the overall provision coverage ratio of banks was 183.2%, which was 2.8% lower than that at the end of 20 18. Of course, the situation of listed banks is better than that of the whole bank. The provision coverage ratio has risen instead of falling, and the non-performing rate has been well controlled.

Still proposing for the two sessions? At the end of March next year, SMEs will postpone the loan repayment policy? It is reflected in the quality of bank assets and the time span of non-performing loans. The quality of bank book assets is expected to remain relatively stable. There is no obvious deterioration. In addition, the bank's early profit-making will also help SMEs tide over the difficulties. The recovery of business activities of enterprises is also conducive to the improvement of the quality of bank assets.

Citic Securities said on July 27th that the Hong Kong stock market had panic selling under the shock of internal and external factors. Internet industry, network security law and anti-monopoly law are stricter, education? Double reduction? The policy has been implemented, and the US Securities and Exchange Commission (sec) reported in Reuters and other media? Mandatory disclosure of China's administrative intervention in China enterprises listed in the United States? China's tough stance echoed, triggering the overall risk aversion of overseas investors. Do we think strong supervision of the education industry? Public welfare? The particularity of non-profit does not represent the overall risk of VIE. A lot of China? New economy? Is the industry realized? People's yearning for a better life? Target, so to speak? Profit? . In the case of extreme pessimism, or triggering negative effects such as redemption, the risk release may last for some time, but at present, the valuation of Hang Seng Index is close to 1xPB, and there is limited room for decline. At present, the macro policy is still to maintain liquidity and support? Hard technology? Innovation.