In today’s briefing:
- China Online Marketplaces: 4Q23 Preview
- CMA – Net Interest Income -21% with Criticized Assets +53% and CRE Loans Rising 32% YoY
China Online Marketplaces: 4Q23 Preview
- We argued in last follow-up note that property woes and challenging macro situation would keep pressuring China online marketplaces’ valuation despite their improving profitability and cashflow.
- The sector’s brutal de-rating since last 4Q has been pricing in a dire growth outlook and it is closer to the end of tunnel in our view.
- We expect a lackluster 4Q23 results season for the sector in general but also less share price volatility given extremely depressed valuation. Stay positive over 12-month time horizon.
CMA – Net Interest Income -21% with Criticized Assets +53% and CRE Loans Rising 32% YoY
- CMA shows how the profile of net interest income can weaken considerably with rising funding costs and risk aversion
- Criticized assets are rising substantially and even so, the bank has not taken a higher provision expense in the quarter – this can be yet to come
- CRE loans are growing faster than other loan, at a time when New York Community Bank (NYCB US) shows the current risks on these loans
💡 Before it’s here, it’s on Smartkarma
Sign Up for Free
The Smartkarma Preview Pass is your entry to the Independent Investment Research Network
- ✓ Unlimited Research Summaries
- ✓ Personalised Alerts
- ✓ Custom Watchlists
- ✓ Company Data and News
- ✓ Events & Webinars
