HLIB Research said CIMB remains the least expensive banking stock in its coverage.
PETALING JAYA: CIMB Group Holdings Bhd
continues to be a favoured banking stock following the within-expectations financial performance of its Indonesian subsidiary, PT Bank CIMB Niaga Tbk, which released its financial results for the second quarter ended June 30 (2Q) on Wednesday.
Hong Leong Investment Bank (HLIB) Research said CIMB Niaga’s 1.4% growth in net profit for the first half of financial year ending Dec 31, 2025 (1H25) compared to 1H24 was within expectations and accounted for 49% of both its and the market’s full-year forecasts.
CIMB Niaga contributes around 20% to 25% of CIMB Group’s pre-tax profit.
The research house has maintained a “buy” call on CIMB with an unchanged target price (TP) of RM8.80.
Noting that the risk-reward profile for the stock skews favourable, it said CIMB remains the least expensive banking stock in its coverage, trading at an attractive 0.91 times financial year 2026 (FY26) price-to-book while offering a solid 6% dividend yield.
TA Research noted that CIMB Niaga continues to demonstrate strong cost discipline in 1H25, with a controlled increase in personnel expenses, up 3.6% in 2Q compared to the same quarter a year ago and 4.3% reduction in other expenses.
There was broad-based loan growth led by auto loans as well as unsecured loans and loans to small medium enterprises. Deposit growth was also strong, driven by current and savings accounts.
It has reiterated a “buy” call on parent CIMB with an unchanged TP of RM8.86 pending the release of its 2Q results soon.
