Daiwa: Target price of HK$56.3 for initial “outperforming the market” rating for China Merchants Bank (03968)

The Zhitong Finance App learned that Daiwa released a research report stating that it initially gave China Merchants Bank (03968) a “outperforming the market” rating, with a target price of HK$56.3, believing that the inflection point in handling fee revenue will reshape its profit advantage.

The bank pointed out that CMB's handling fee revenue fell by 23% from 2021 to 2024, mainly due to regulatory adjustments rather than franchise erosion, but recovery has begun. Net fee revenue increased 4% in 2025, and 6% year-on-year increase in the first half of 2026.

The bank predicts an 8% to 8.4% increase in net fee revenue from 2026 to 2028, while also anticipating a 6% to 7% year-on-year increase in revenue and 6% to 8% year-on-year increase in net profit from 2026 to 2028.