Tagged: Buffett

“Buffett’s successor” grabs to raise this bank stock again

Keep fighting! “Buffett successor” Li Lu is still in a big increase in Postal Savings Bank H shares.

"Buffett's successor" grabs to raise this bank stock again

On January 20, a Chinese reporter from the securities firm disclosed from the Hong Kong stock exchange that after Li Lu had bought H shares of postal savings bank, he was still increasing his holdings of postal savings bank through his Himalayan capital recently.

 

Data show that stimulated by the good news, the A shares and H shares of postal savings bank opened higher on January 15, and their H shares rose by 15.87%. On the same day, Li Lu continued to increase his holdings of postal savings bank through Himalayan capital and bought 83.544 million shares of the bank.

 

In the past five trading days, the banking sector recorded significant gains, while the A-share and H-share banking sectors showed positive emotions. According to choice data, the A-share bank index was positive for four consecutive days until the 20th when it was adjusted. In terms of Hong Kong banks, the index also rose significantly, rising about 2.12% in the past five trading days.

 

Li Lu holds 269 million shares more

 

Recently, the Hong Kong Stock Exchange disclosed that Yi once again announced that on January 15, through his Himalayan capital, Li Lu purchased 83.544 million Hong Kong shares of postal savings bank at an average price of about HK $5.35 per share at a total cost of about HK $447 million.

 

It is worth noting that after the increase, the H shares of postal savings bank held by Himalayan capital under Li Lu have increased to 1.274 billion shares. It can be inferred from the information disclosed by the Hong Kong stock exchange that in less than one month from December 19, 2020 to January 15, 2021, Li Lu continued to buy 269 million H shares of postal savings bank.

 

So far, the “successor to Warren Buffett” with a prominent investment background has held 6.42% of the total share capital of H shares issued by postal savings bank. If calculated by the closing price of HK $5.24 per share on January 20, its stock market value has exceeded HK $6.67 billion, equivalent to about RMB 5.57 billion.

 

The reporter noted that on December 18, 2020, the HKEx recorded for the first time that Li Lu spent HK $132.62 billion to buy H shares of postal savings bank. At that time, he held 1.005 billion shares, with a market value of about HK $4.241 billion. As of January 20, in just 22 trading days, the postal savings bank has increased by more than 24%, and the floating profit of this part of its shares has reached HK $1025 million.

 

Similarly, when Warren Buffett bought Wells Fargo in 1990, the P / E ratio was less than 5 times. At present, the H shares of postal savings bank are only about 6.7 times, and the P / B ratio is lower than the net assets per share, which is only 0.6 times.

 

According to public information, Himalayan capital management company was founded by Li Lu at the end of 1997. Currently, it is headquartered in Los Angeles, USA. It mainly invests in high-quality companies with long-term competitive advantages and huge growth potential in Asia and North America. At present, Himalayan capital has assets under management of at least $10 billion.

"Buffett's successor" grabs to raise this bank stock again

In fact, Himalayan capital rarely disclosed its position. However, according to the information disclosed by the US Securities Regulatory Commission, a hedge fund with total assets of about US $1.39 billion held by Himalayan capital shows that as of the end of September 2020, the fund has held four stocks, of which about 41.09% is Meguiar technology, the largest computer memory chip manufacturer in the United States, followed by Internet companies, of which 26.58% is Chinese Social media giant Facebook, 9.63% of which is Google’s parent company alphabet; financial stocks are Bank of America, with a position of 22.7%.

 

Earlier, in an interview with the media, Li Lu said that he was very optimistic about China’s economic development and believed that China’s economic opportunities were all-round. He believes that it is not only the continuous improvement of industrial technology, but also the large-scale popularization of urban living standards to the rural population. There are also many endogenous needs that will be created in this process.

 

Recently, the banking sector rose significantly, with a net capital inflow of more than 5.6 billion yuan

 

In the last five trading days, the banking sector recorded a large increase, and the main capital showed a net inflow state. According to wind data, the net inflow of the banking sector reached 5.654 billion yuan in five days.

 

Prior to this, by a number of banks faster than expected results and other good news stimulation, the obvious outbreak of the banking sector, mainly in January 15. On the same day, the plate index once rose by more than 4.5%, industrial bank, China Merchants Bank, Ping An Bank once rose by more than 8%, and set a record high in the day, while postal savings bank once rose by the limit, and finally closed up by 8.37%.

 

Specifically, according to Ifind data, the Bank of Chengdu was the biggest gainer of a shares in recent 5 days, with a range of 12.88% from January 14 to 20. Industrial Bank and postal savings bank followed closely, with an increase of 10.05% and 9.39% respectively. In addition, Ping An Bank, Wuxi bank and Changsha bank also rose more than 5% in recent five days, up 8.55%, 6.82% and 5.44% respectively.

 

However, Ifind data showed that on January 20, the banking sector adjusted after rising for four consecutive days. On the same day, A-share banking sector a total of 32 stocks fell, 2 flat, only Ping An Bank, Bank of Xi’an, Jiangyin bank 3 stocks closed up.

 

Among them, industrial bank, Bank of Hangzhou and Bank of Changsha fell the top three on the 20th. The three stocks fell 2.76%, 2.71% and 2.56% respectively. Bank of Chengdu, China Construction Bank and Everbright Bank also fell more than 2%.

 

The performance of listed banks continued to disclose, and the net profit performance still exceeded expectations

 

In recent days, after Bank of Shanghai, China Merchants Bank and industrial bank disclosed the performance data exceeding the market expectation in 2020, many banks continued to release their unaudited business performance in 2020. The data shows that the net profit growth of most listed banks is positive year-on-year, exceeding market expectations.

 

On the 18th, the Bank of Jiangsu released a performance express, showing that in 2020, the bank’s total operating revenue was 52.026 billion yuan, an increase of 15.68% over the same period of last year; the net profit attributable to shareholders of listed companies was 15.066 billion yuan, an increase of 3.06% over the same period of last year. In terms of non-performing loan ratio, the non-performing loan ratio of the bank was 1.32% at the end of 2020, which was 0.06 percentage point lower than that at the beginning of the period, falling for five consecutive years.

 

On the 20th, Bank of Wuxi and Bank of Jiangyin disclosed their respective performance in 2020. Among them, in 2020, Wuxi bank achieved a revenue of 3.896 billion yuan, a year-on-year increase of 10.06%; the net profit attributable to shareholders of listed companies was 1.312 billion yuan, a year-on-year increase of 4.96%. By the end of 2020, the non-performing loan ratio of the bank was 1.10%, 0.11 percentage point lower than that at the beginning of the year.

 

According to the performance express of Jiangyin bank, last year’s revenue was 3.323 billion yuan, down 2.38% compared with the same period last year; the net profit attributable to shareholders of listed companies was 1.057 billion yuan, up 4.34% compared with the same period last year. The non-performing loan ratio was 1.79%, 0.04 percentage point lower than that at the beginning of the year.

 

As for the recent performance of the banking sector, Wang Yifeng, banking analyst of Everbright Securities, said in the research report that driven by the “catalyst” of the annual performance express, the recovery of economic fundamentals resonated with the abundant liquidity, which promoted the rise of banking stocks. On the whole, the bank financial indicators of the performance express disclosed in the early stage perform well, especially the quarterly profit growth.

 

According to the analysis of Wang Jian’s team in the research report, bank stocks are mainly divided into “growth stocks” with rapid performance growth and “cyclical stocks” with return on investment from the valuation repair brought about by macroeconomic cycle. Among them, the vast majority of banks are classified as “cyclical stocks” due to lack of growth, and their stock price performance mainly depends on whether the banking sector as a whole gets valuation repair. According to Wang Jian’s team, under the reversal logic of bank fundamentals in 2021, investors should pay attention to the “cyclical stock” attribute of banks.

 

Guo Qiwei, banking analyst of Minsheng securities, pointed out in the research report that the peak of social finance, the tightening of credit, the enhancement of the bargaining power of the bank’s asset side, and the lifting of policy restrictions on the release of profits have all accelerated the improvement of bank fundamentals. Minsheng securities suggests to actively grasp the bank express market from January to February, and there is still room for the valuation of bank stocks to rise.