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China Minsheng Banking Corp Ltd revenue growth accelerated from 0.79% in 2016 to 9.0% in 2017

29/03/2018 • About China Minsheng Banking Corp Ltd ($1988) • By InTwits

China Minsheng Banking Corp Ltd reported 2017 financial results today. Overall the company's long term financial model is characterised by the following facts:
  • China Minsheng Banking Corp Ltd has low CAPEX intensity: 5 year average CAPEX/Revenue was 4.9%. At the same time it's a lot of higher than industry average of 2.3%.
  • CAPEX is quite volatile: 10,244 in 2017, 10,681 in 2016, 7,490 in 2015, 18,649 in 2014, 14,700 in 2013
  • The company has potentially unprofitable business model: ROIC is at 2.2%
  • It operates with high leverage: Net Debt/EBITDA is 0.5x while industry average is
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.

China Minsheng Banking Corp Ltd ($1988) key annual financial indicators

mln. CNY201320142015201620172017/2016
P&L
Revenue217,636244,746265,262267,353291,5299.0%
Net Income42,27844,54646,11147,84349,8134.1%
Balance Sheet
Cash522,687547,094534,259524,239442,938-15.5%
Short Term Debt573,677891,719990,7751,845,9311,798,165-2.6%
Long Term Debt173,803278,871352,248398,376501,92726.0%
Cash flow
Capex14,70018,6497,49010,68110,244-4.1%
Ratios
Revenue growth22.1%12.5%8.4%0.8%9.0%
Net Income Margin19.4%18.2%17.4%17.9%17.1%-0.8%
CAPEX, % of revenue6.8%7.6%2.8%4.0%3.5%-0.5%
ROIC5.0%4.7%3.7%2.7%2.2%-0.5%
ROE23.4%20.3%17.0%14.9%13.8%-1.1%


China Minsheng Banking Corp Ltd ($1988) key quoterly financial indicators

mln. CNY17Q117Q217Q317Q4YoY change
P&L
Revenue73,20671,65872,34476,20610.2%13.3%7.3%7.8%
Net Income14,19913,88912,1559,5703.6%2.8%1.8%10.3%
Balance Sheet
Cash453,510424,669424,566442,9386.0%-14.9%-6.7%-15.5%
Short Term Debt1,741,4022,000,6851,531,7511,986,29741.2%22.4%1.6%-1.8%
Long Term Debt601,899166,644598,960313,795102.2%-6.6%10.3%42.0%
Ratios
Net Income Margin 19.4% 19.4% 16.8% 12.6%-1.2%-2.0%-0.9%0.3%

Revenue and profitability


China Minsheng Banking Corp Ltd's Revenue increased on 9.0%. Revenue growth showed slow down in 17Q4 - it was 7.8% YoY.

Net Income marign decreased slightly on 0.81 pp from 17.9% to 17.1% in 2017.

Capital expenditures (CAPEX) and working capital investments


China Minsheng Banking Corp Ltd's CAPEX/Revenue was 3.5% in 2017. CAPEX/Revenue decreased on 4.1 pp from 7.6% in 2014 to 3.5% in 2017. It's average level of CAPEX/Revenue for the last three years was 3.4%.

Return on investment


The company operates at good ROE (13.81%) while ROIC is low (2.16%). ROIC decreased slightly on 0.52 pp from 2.7% to 2.2% in 2017. ROE decreased slightly on 1.1 pp from 14.9% to 13.8% in 2017.

Leverage (Debt)


Debt increased on 2.5% while cash dropped on 15.5%.

Appendix 1: Peers in Banks


Below you can find China Minsheng Banking Corp Ltd benchmarking vs. other companies in Banks industry. It's shown for the period of 5 years for the key financial metrics. Each table has median value for all the companies in the industry together with individual financial data of the top-5 companies in the industry by particular financial metric.

Top companies by Revenue growth, %

Top 5 FY2013 FY2014 FY2015 FY2016 FY2017
Shengjing Bank Co Ltd ($2066)36.3%40.1%24.3%17.5%
Huishang Bank Corp Ltd ($3698)22.8%24.3%24.6%17.3%
Chong Hing Bank Ltd ($1111)-1.2%121.1%-17.4%0.7%
Hang Seng Bank Ltd ($11)8.8%9.3%1.4%-2.0%
Chongqing Rural Commercial Bank Co Ltd ($3618)21.7%23.6%7.6%-4.7%
 
Median (8 companies)12.1%23.6%4.8%-3.3%7.1%


Top companies by CAPEX/Revenue, %

Top 5 FY2013 FY2014 FY2015 FY2016 FY2017
Shengjing Bank Co Ltd ($2066)2.2%5.0%3.0%2.3%
Chong Hing Bank Ltd ($1111)1.6%0.7%1.9%2.1%
Chongqing Rural Commercial Bank Co Ltd ($3618)4.3%4.8%4.4%2.0%
HSBC Holdings ($5)2.3%1.8%1.7%1.8%
Bank of East Asia Ltd/The ($23)2.9%1.1%1.6%1.8%
 
Median (8 companies)2.9%1.8%2.5%1.8%0.8%


Top companies by ROIC, %

Top 5 FY2013 FY2014 FY2015 FY2016 FY2017
Hang Seng Bank Ltd ($11)9.5%9.0%8.3%8.1%
Chong Hing Bank Ltd ($1111)5.2%16.4%5.7%5.6%
Chongqing Rural Commercial Bank Co Ltd ($3618)5.7%5.2%4.3%4.1%
Huishang Bank Corp Ltd ($3698)6.8%5.8%4.3%4.0%
Shengjing Bank Co Ltd ($2066)6.6%5.3%3.5%2.3%
 
Median (12 companies)6.2%5.4%4.3%3.1%1.5%