Huishang Bank (3698) AI Stock Analysis

• Market Cap: HK$45.98B
• Dividend Yield: 7.06%
• Average Volume (3M): 2.05M
• Price to Earnings (P/E): 2.8
• Beta (1Y): 0.40
• Revenue Growth: -0.12%
• EPS Growth: 3.42%
• Country: HK
• Employees: 12,837
• Sector: Financial
• Sector Strength: 70
• Industry: Banks - Regional
• EPS (TTM): 0.73
• Shares Outstanding: 3,478,750,000
• 10 Day Avg. Volume: 1,309,640
• 30 Day Avg. Volume: 2,047,238
• PEG Ratio: 0.25
• Price to Book (P/B): 0.20
• Price to Sales (P/S): 0.95
• P/FCF Ratio: -0.20
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 62 Neutral
• Price Target: HK$3.50 ▲(8.36% Upside)

The score is supported mainly by very attractive valuation (low P/E and high dividend yield) and generally solid profitability/leverage trends. Offsetting these positives are significant cash flow volatility (including a large 2024 free cash outflow) and weak technical momentum with the stock below key moving averages and negative MACD.

Positive Factors

Improved Leverage

A significant reduction in leverage enhances financial stability and reduces risk, providing a stronger foundation for future growth and investment.

Governance Reforms

Streamlining governance by transferring supervisory powers to the Audit Committee can enhance decision-making efficiency and regulatory compliance.

Asset Growth

Steady asset growth indicates expanding operations and market presence, supporting long-term revenue potential and competitive positioning.

Negative Factors

Cash Flow Volatility

Volatile cash flow undermines financial predictability and flexibility, complicating strategic planning and potentially increasing reliance on external funding.

Revenue Growth Challenges

Inconsistent revenue growth, particularly the decline in 2023, may signal market or operational challenges, affecting long-term growth prospects.

Choppy Profit Margins

Inconsistent profit margins reduce confidence in financial performance and comparability, potentially impacting investor trust and strategic planning.

Huishang Bank Business Overview & Revenue Model

Company Description

Huishang Bank Corporation Limited, together with its subsidiaries, provides various commercial banking products and services in the People's Republic of China. The company operates through four segments: Corporate Banking, Retail Banking, Treasury, and Others. It offers current accounts, deposits, overdrafts, loans, trade related products and other credit facilities, foreign currency, and wealth management products to corporate customers, government authorities, and financial institutions. The company also provides savings deposits, personal loans and advances, credit and debit cards, payments and settlements, wealth management products and funds, and insurance agency services to retail customers. In addition, it conducts securities investment, money market, and repurchase transactions; and offers online and mobile banking services. Further, the company provides Renminbi and foreign currency deposits; and clearing and settlement, assets custody, and finance leasing services. As of December 31, 2021, it had 21 branches; 478 front offices; 609 self-service banks; and 2,002 cash self-service equipment comprising 1,213 cash recycling machines and 789 smart self-service terminals. The company was formerly known as Hefei Commercial Bank Co., Ltd. and changed its name to Huishang Bank Corporation Limited in November 2005. Huishang Bank Corporation Limited was incorporated in 1997 and is headquartered in Hefei, China.

How the Company Makes Money

Huishang Bank primarily generates revenue through interest income from its lending activities, which include loans to individuals and businesses. The bank earns interest on the funds it lends out, which constitutes a significant portion of its income. In addition to interest income, Huishang Bank also generates revenue from non-interest income streams such as service fees, commissions, and wealth management services. These include fees from transaction services, account management, and investment product sales. The bank's treasury operations contribute to its earnings through investments in securities and interbank lending. Partnerships with other financial institutions and government entities can also play a role in expanding its business opportunities and revenue potential.

Huishang Bank Financial Statement Overview

Summary

Huishang Bank exhibits strong financial performance with consistent revenue growth and high profitability as seen in the income statement. The balance sheet shows improved leverage management, but high liabilities compared to equity and cash flow challenges remain concerns.

Income Statement

Huishang Bank shows robust income statement performance with consistent revenue growth and strong profitability. The gross profit margin remains at 100% due to the nature of banking revenue. The net profit margin improved from 51.9% in 2023 to 52.3% in 2024, indicating solid cost control and profit efficiency. Revenue growth from 2023 to 2024 was approximately 5.9%, demonstrating a positive upward trend. EBIT and EBITDA margins are strong, reflecting operational efficiency, though EBITDA data is unavailable.

Balance Sheet

The bank's balance sheet is stable with a debt-to-equity ratio decreasing from 1.28 in 2023 to 0.44 in 2024, showing improved leverage management. The return on equity (ROE) increased from 10.1% in 2023 to 9.8% in 2024, indicating effective use of equity to generate profits. The equity ratio improved to 7.8%, reflecting a solid capital base. However, the high level of total liabilities compared to equity remains a potential risk.

Cash Flow

Cash flow management shows mixed results. Free cash flow turned negative in 2024 due to significant operating cash flow outflows, indicating pressure on liquidity. However, the operating cash flow to net income ratio reflects cash generation challenges. Despite this, the bank maintained positive financing cash flows, indicating reliance on external funding. The decline in free cash flow growth rate is a concern moving forward.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	29.95B	33.76B	27.80B	29.36B	22.16B	19.68B
Gross Profit	29.95B	33.76B	27.80B	29.36B	22.16B	19.68B
EBITDA	0.00	0.00	0.00	18.35B	14.54B	0.00
Net Income	15.89B	15.41B	14.43B	13.40B	11.46B	9.57B
Balance Sheet
Total Assets	2.25T	2.01T	1.81T	1.58T	1.38T	1.27T
Cash, Cash Equivalents and Short-Term Investments	148.08B	24.78B	27.51B	36.57B	19.72B	42.40B
Total Debt	325.80B	69.41B	182.65B	218.96B	32.42B	34.93B
Total Liabilities	2.09T	1.85T	1.66T	1.46T	1.27T	1.17T
Stockholders Equity	162.12B	157.45B	142.98B	119.61B	108.56B	103.04B
Cash Flow
Free Cash Flow	-61.49B	-159.44B	89.96B	49.63B	36.19B	-55.57B
Operating Cash Flow	-60.76B	-158.87B	90.58B	50.19B	37.01B	-54.60B
Investing Cash Flow	-130.54B	-69.00B	-60.80B	-64.96B	-36.19B	-9.80B
Financing Cash Flow	188.08B	227.02B	-33.63B	28.28B	-9.31B	61.33B

Huishang Bank Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 3.23
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HK:3698, the sentiment is Positive. The current price of 3.23 is below the 20-day moving average (MA) of 3.24, below the 50-day MA of 3.41, and above the 200-day MA of 3.22, indicating a neutral trend. The MACD of -0.02 indicates Negative momentum. The RSI at 51.23 is Neutral, neither overbought nor oversold. The STOCH value of 70.96 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for HK:3698.

Huishang Bank Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
Sector *	68 Neutral	$18.00B	11.42	9.92%	3.81%	9.73%	1.22%
3866	67 Neutral	HK$26.25B	5.11	―	4.45%	4.33%	17.13%
1963	67 Neutral	HK$34.32B	4.46	9.11%	5.69%	5.30%	9.05%
3698	62 Neutral	HK$45.98B	2.84	11.00%	7.06%	-0.12%	3.42%
9889	58 Neutral	HK$23.35B	5.31	7.20%	7.99%	-7.29%	-14.37%
9677	58 Neutral	HK$16.09B	7.29	8.48%	3.57%	6.65%	16.74%
1551	53 Neutral	HK$21.87B	12.26	―	3.20%	-3.87%	22.34%

Huishang Bank Corporate Events

Huishang Bank Details Board Composition and Committee Roles

Huishang Bank has announced the current composition of its board of directors, listing one executive director, eight non-executive directors and six independent non-executive directors, along with the roles of President and the allocation of chairmanships and memberships across its five key board committees. The disclosure clarifies the governance structure and oversight responsibilities in areas such as strategic development, consumer rights protection, audit, nomination and remuneration, related party transactions and risk management, signaling the bank’s emphasis on regulatory compliance and transparent governance for investors and other stakeholders.

The most recent analyst rating on (HK:3698) stock is a Sell with a HK$2.71 price target. To see the full list of analyst forecasts on Huishang Bank stock, see the HK:3698 Stock Forecast page.

Huishang Bank Gains Regulatory Approval for New Non-Executive Director

Huishang Bank has announced that the National Financial Regulatory Administration Anhui Office has formally approved the qualification of Mr. Wei Lixiang to serve as a non-executive director on the bank’s fourth session board of directors. This regulatory clearance finalizes his election, previously endorsed at the 2024 annual general meeting, and further solidifies the bank’s board composition, which now includes a mix of executive, non-executive and independent non-executive directors, potentially reinforcing its governance structure and regulatory compliance profile in the mainland Chinese banking sector.

The most recent analyst rating on (HK:3698) stock is a Sell with a HK$2.71 price target. To see the full list of analyst forecasts on Huishang Bank stock, see the HK:3698 Stock Forecast page.

Huishang Bank Calls 2026 EGM to Overhaul Governance Structure

Huishang Bank Corporation Limited has convened its first extraordinary general meeting of 2026 for 2 February in Hefei, where shareholders will vote on a series of significant governance changes. The agenda includes a special resolution to abolish the Board of Supervisors and to adopt revised Articles of Association, alongside ordinary resolutions to update the rules of procedure for both the shareholders’ general meeting and the board of directors. The proposed changes, which reflect a reshaping of the bank’s internal oversight and decision-making framework, could meaningfully alter its corporate governance structure and operational oversight mechanisms; shareholders are being asked to participate via poll voting, with detailed arrangements set out for share registration, attendance, and proxy voting in line with Hong Kong listing requirements.

The most recent analyst rating on (HK:3698) stock is a Sell with a HK$2.71 price target. To see the full list of analyst forecasts on Huishang Bank stock, see the HK:3698 Stock Forecast page.

Huishang Bank Announces Closure of Register for 2026 EGM

Huishang Bank Corporation Limited has announced the closure of its register of members in preparation for its 2026 first extraordinary general meeting (EGM) scheduled for February 2, 2026. This move is aimed at determining shareholders’ entitlement to attend and vote at the EGM, with relevant transfer documents required to be submitted by January 2, 2026. The announcement indicates the bank’s procedural steps to ensure proper shareholder engagement and compliance ahead of the meeting.

The most recent analyst rating on (HK:3698) stock is a Sell with a HK$2.71 price target. To see the full list of analyst forecasts on Huishang Bank stock, see the HK:3698 Stock Forecast page.

Huishang Bank Proposes Major Governance Reforms

Huishang Bank Corporation Limited has announced significant corporate governance changes, including the proposed abolishment of its Board of Supervisors. This move is intended to streamline governance by transferring supervisory powers to the Audit Committee under the Board of Directors, in accordance with regulatory requirements. Additionally, the bank plans to amend its Articles of Association and the rules of procedure for both the General Meeting and the Board, aiming to enhance its corporate governance framework. These changes are subject to approval by the general meeting and relevant regulatory authorities.

The most recent analyst rating on (HK:3698) stock is a Sell with a HK$2.71 price target. To see the full list of analyst forecasts on Huishang Bank stock, see the HK:3698 Stock Forecast page.

Huishang Bank Reports Stable Financial Performance for Nine Months Ending September 2025

Huishang Bank Corporation Limited announced its unaudited financial results for the nine months ending September 30, 2025. The bank reported total assets of RMB 2,297,640 million and a net profit of RMB 14,149 million. The capital adequacy ratios were in compliance with PRC regulatory requirements, indicating a stable financial position. The announcement highlights the bank’s issuance of tier 2 and non-fixed term capital bonds, which are crucial for maintaining its capital adequacy and supporting future growth.

The most recent analyst rating on (HK:3698) stock is a Sell with a HK$2.71 price target. To see the full list of analyst forecasts on Huishang Bank stock, see the HK:3698 Stock Forecast page.