China Merchants Bank Co (3968) AI Stock Analysis

• Market Cap: HK$1.19T
• Dividend Yield: 4.27%
• Average Volume (3M): 15.71M
• Price to Earnings (P/E): 8.0
• Beta (1Y): 1.14
• Revenue Growth: -4.57%
• EPS Growth: 1.77%
• Country: HK
• Employees: 117,201
• Sector: Financial
• Sector Strength: 70
• Industry: Banks - Regional
• EPS (TTM): 1.70
• Shares Outstanding: 4,590,901,400
• 10 Day Avg. Volume: 18,292,943
• 30 Day Avg. Volume: 15,710,003
• PEG Ratio: 11.98
• Price to Book (P/B): 0.77
• Price to Sales (P/S): 1.90
• P/FCF Ratio: 2.30
• 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: HK$56.56
• Price Target Upside: 10.37% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 10
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 82 Outperform
• Price Target: HK$60.00 ▲(17.07% Upside)

China Merchants Bank scores well due to its robust financial performance and attractive valuation. Technical indicators show positive momentum, though caution is advised due to potential overbought conditions. The earnings call highlighted both strengths in asset growth and challenges in income, but the bank's strategic focus remains promising.

China Merchants Bank Co Business Overview & Revenue Model

Company Description

China Merchants Bank Co., Ltd. (CMBC), established in 1987, is one of the leading commercial banks in China, headquartered in Shenzhen. The bank primarily operates in the retail banking and corporate banking sectors, offering a wide range of financial services including personal banking, corporate financing, wealth management, and investment services. With a strong focus on innovation and technology, CMBC is committed to providing comprehensive financial solutions to its diverse clientele, which includes individual consumers, small and medium-sized enterprises (SMEs), and large corporations.

How the Company Makes Money

China Merchants Bank generates revenue primarily through interest income from loans, fees from various banking services, and investment income. The main revenue streams include interest earned from personal and corporate loans, which constitutes a significant portion of their earnings. Additionally, the bank earns fees from services such as account management, transaction processing, and wealth management advisory services. The bank also engages in treasury operations, generating income through investments in bonds and other financial instruments. Strategic partnerships with fintech companies and other financial institutions enhance their service offerings and operational efficiency, contributing positively to their overall revenue. Furthermore, the growing demand for digital banking solutions has allowed CMBC to tap into the increasing number of retail banking customers, thereby expanding its customer base and revenue potential.

China Merchants Bank Co Financial Statement Overview

Summary

China Merchants Bank demonstrates strong financial health with solid profitability, a robust balance sheet free of debt, and efficient cash flow management. The bank's revenue growth and sound financial strategies position it favorably within the regional banking sector. However, vigilance is needed to maintain cash flow growth for long-term stability.

Income Statement

China Merchants Bank has shown solid growth with a steady revenue increase from 2023 to 2024. The gross profit margin remains high due to the bank's nature, with a net profit margin also showing strength. While there is a lack of EBIT and EBITDA data for the latest year, the net income has grown, indicating efficient cost management.

Balance Sheet

The bank exhibits a strong balance sheet with zero total debt in 2024, indicating excellent financial health. The equity has also grown, reflecting positive shareholder value. The equity ratio is favorable, showing a stable balance between assets and equity, which minimizes risk.

Cash Flow

The operating cash flow has increased significantly, boosting the free cash flow. The bank demonstrates strong cash generation capabilities, which supports its operational stability. The free cash flow to net income ratio is healthy, although a decrease in free cash flow growth signals a need for caution in future cash management.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	480.58B	497.85B	497.59B	477.40B	450.36B	225.61B
Gross Profit	330.21B	334.86B	336.65B	342.26B	327.22B	225.61B
EBITDA	177.92B	194.24B	192.06B	179.72B	161.70B	0.00
Net Income	148.58B	148.39B	146.60B	138.01B	119.92B	97.34B
Balance Sheet
Total Assets	12.66T	12.15T	11.03T	10.14T	9.25T	8.36T
Cash, Cash Equivalents and Short-Term Investments	1.24T	2.10T	1.07T	960.91B	846.62B	876.67B
Total Debt	433.19B	471.07B	436.55B	455.39B	631.11B	609.26B
Total Liabilities	11.36T	10.92T	9.94T	9.18T	8.38T	7.63T
Stockholders Equity	1.29T	1.23T	1.08T	945.50B	858.75B	723.75B
Cash Flow
Free Cash Flow	449.75B	412.09B	327.59B	535.25B	157.89B	402.20B
Operating Cash Flow	473.30B	447.02B	357.75B	570.14B	182.05B	421.33B
Investing Cash Flow	-412.23B	-292.86B	-255.11B	-513.93B	-19.70B	-240.75B
Financing Cash Flow	-101.67B	2.15B	-72.99B	-297.03B	89.36B	-211.79B

China Merchants Bank Co Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 51.25
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HK:3968, the sentiment is Neutral. The current price of 51.25 is below the 20-day moving average (MA) of 51.94, above the 50-day MA of 50.36, and above the 200-day MA of 48.25, indicating a neutral trend. The MACD of 0.23 indicates Positive momentum. The RSI at 48.57 is Neutral, neither overbought nor oversold. The STOCH value of 26.75 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for HK:3968.

China Merchants Bank Co Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
3968	82 Outperform	HK$1.19T	8.03	―	4.27%	-4.57%	1.77%
2388	78 Outperform	$402.19B	9.97	12.04%	6.02%	1.90%	12.81%
1658	77 Outperform	HK$678.75B	6.16	9.30%	5.41%	-1.54%	-3.95%
6818	72 Outperform	HK$225.60B	5.13	―	5.62%	-8.41%	-5.52%
1988	72 Outperform	HK$186.62B	5.77	5.16%	8.78%	-7.28%	-5.00%
0998	69 Neutral	HK$439.68B	5.11	9.71%	5.63%	-5.46%	0.33%
Sector *	68 Neutral	$18.00B	11.42	9.92%	3.81%	9.73%	1.22%

China Merchants Bank Co Corporate Events

China Merchants Bank Announces Dividend Distribution for Preference Shares

China Merchants Bank Co., Ltd. has announced the implementation of its dividend distribution plan for domestic preference shares, with a declared cash dividend of RMB3.62 per share, totaling RMB995.5 million. This decision, approved by the board of directors, reflects the company’s commitment to delivering value to its shareholders and maintaining a robust financial strategy, potentially impacting its market positioning and stakeholder relations positively.

China Merchants Bank Launches New Financial Asset Investment Subsidiary

China Merchants Bank Co., Ltd. has received approval from the National Financial Regulatory Administration to commence business operations for its new subsidiary, China Merchants Bank Financial Asset Investment Co., Ltd., with a registered capital of RMB15.0 billion. This strategic move aims to enhance the company’s operational capabilities by conducting market-based debt-to-equity swaps and pilot operations in equity investments, thereby driving high-quality development and supporting technological innovation.

China Merchants Bank Announces New Director Appointment

China Merchants Bank Co., Ltd. announced the approval of Deng Renjie’s appointment as a non-executive director by the National Financial Regulatory Administration. This appointment, effective from October 30, 2025, is expected to influence the strategic direction of the bank as it continues to navigate the competitive financial services industry.

China Merchants Bank Announces Board Composition and Roles

China Merchants Bank Co., Ltd. has announced the composition of its board of directors, detailing the roles and functions of each member. The board includes shareholder directors, executive directors, and independent non-executive directors, with various members serving on six special committees. This announcement underscores the bank’s commitment to structured governance and strategic oversight, potentially impacting its operational efficiency and stakeholder confidence.

China Merchants Bank Releases Q3 2025 Financial Report

China Merchants Bank Co., Ltd. has released its unaudited third quarterly report for 2025, prepared in accordance with IFRS Accounting Standards. The report has been reviewed and approved by the company’s Board of Directors and Supervisors, confirming its accuracy and completeness. This announcement underscores the bank’s commitment to transparency and accountability in its financial reporting, which is crucial for maintaining investor confidence and ensuring compliance with regulatory standards.

China Merchants Bank Appoints New Non-Executive Director

China Merchants Bank Co., Ltd. has announced the approval of Jiang Chaoyang’s appointment as a non-executive director, effective from October 24, 2025. This strategic appointment is expected to strengthen the company’s leadership, potentially impacting its operations and market positioning positively.

China Merchants Bank Announces Board Composition and Committee Roles

China Merchants Bank Co., Ltd. has announced the composition of its Board of Directors, detailing the roles and functions of each member. This announcement includes the establishment of six special committees, each with specific responsibilities, which are expected to enhance the bank’s governance and strategic oversight. The restructuring aims to bolster the bank’s operational efficiency and strengthen its market position, potentially impacting stakeholders positively by ensuring robust risk management and consumer rights protection.

China Merchants Bank to Announce Q3 2025 Results and Host Investor Conference

China Merchants Bank Co., Ltd. announced it will disclose its 2025 third quarterly results on October 29, 2025, via the Hong Kong Exchanges and Clearing Limited website. To provide investors with a comprehensive understanding of its financial performance, the company will hold an online audio press conference on October 31, 2025, where key executives, including the Executive Vice President and Chief Financial Officer, will address investor queries. This initiative aims to enhance transparency and engage stakeholders effectively.

China Merchants Bank to Announce Q3 2025 Results

China Merchants Bank Co., Ltd. announced that its board of directors will meet on October 29, 2025, to review and approve the company’s third-quarter results for the period ending September 30, 2025. This meeting is significant as it will provide insights into the company’s financial performance and could impact its market positioning and stakeholder confidence.