Xiaomo: If the target price of Standard Chartered Group (02888) is raised to HK$295, it will be thrown back as a buying opportunity after listing

The Zhitong Finance App learned that J.P. Morgan Chase released a research report stating that the net interest income growth forecast for Standard Chartered Group (02888) for the 2026 fiscal year was adjusted to 2%, which is higher than management guidelines and market expectations, and that total revenue is expected to increase by about 6%. The bank rolled the target price valuation benchmark to December 2027 and raised Standard Chartered's target price from HK$275 to HK$295, maintaining an “incremental” rating.

J.P. Morgan expects Standard Chartered's adjusted pre-tax profit for the second quarter to shrink by about 15% year-on-year, mainly due to the high base effect of recording US$238 million in revenue from the sale of Solv India in the second quarter of 2025 and higher incidental revenue, as well as cost assumptions. However, the bank believes that if Standard Chartered's stock price rebounds due to weak results in the second quarter, it will provide a buying opportunity because its underlying operating trend is still strong, and the multinational business and network revenue of Chinese companies will benefit.

The bank estimates that Chinese companies' investment and business (including network revenue from China) account for about 10% of Standard Chartered Group's total revenue. As the Mainland relaxes regulations relating to corporate cross-border transactions and accelerates the internationalization of the RMB, it will provide potential support for the non-interest income assumption. Furthermore, the bank expects Standard Chartered's repurchase scale to be US$1 billion in the first half of 2026, while the total return (dividends and repurchases/profit) will increase from 42% in the first half of 2025 to 48% in the first half of 2026.