Citibank: Looking at the opening of CICC (03908) on the 30th positive catalyst, net profit for the third quarter increased 120% to 150%

The Zhitong Finance App learned that Citibank (03908) released a research report saying that CICC (03908) had strong results in the third quarter. The expected profit for the third quarter was about 5 billion to 5.5 billion yuan, an increase of about 120% to 150% over the previous year, better than market expectations of about 3.2 billion yuan. CCC H shares were the first choice for Citibank's Chinese brokerage firms.

The bank pointed out that the strong profit was mainly due to Changxin Technology (688825.SH)'s earnings in terms of market capitalization (1 billion yuan of shares held, the IPO price was 8.66 yuan per share, compared with 55 yuan per share at the end of the third quarter of 2026), strong investment banking revenue, and a low base compared to the third quarter of 2025. Although the issuance of CICC A shares may constitute a short-term selling pressure (the issue price calculated based on the share exchange ratio is about 7% off the current price of CICC A shares), the new shares allotted to China Cinda Group and China Oriental Group have a 3-year lock-up period. The remaining IPOs are only equivalent to 19%/28% of the total share capital/free circulation volume of CICC A shares after the acquisition, which seems to be easier to digest.

The bank believes that the third-quarter results are superior to those of its peers. Coupled with 2026 or an increase in the dividend ratio, the current price is equivalent to 0.7 times the market account ratio forecast for 2026, and the return on equity is a low double-digit percentage, which is attractive for valuations.