Goldman Sachs raises Standard Chartered's target price to 168 yuan, last quarter's performance exceeded expectations

Goldman Sachs published a report indicating that Standard Chartered (02888.HK) will have a basic pre-tax profit in the third quarter of 2025 that exceeds market consensus expectations by 14%, with basic earnings exceeding by 23%. This reflects net interest income exceeding expectations by 2%, non-net interest income exceeding expectations by 4%, operating expenses exceeding expectations by 1%, credit costs exceeding expectations by 23%, and a tax rate that is 4 percentage points lower than expected. The quarterly basic return on equity for shareholders is 13.4% (market consensus is 10.1%), and the common equity tier 1 capital ratio is 14.2%.

Standard Chartered has raised its guidance for total revenue and return on equity for the full year 2025, now expecting revenue growth to approach the "upper limit" of the 5% to 7% range (previously "close to the lower limit"), and anticipates a return on equity of about 13% in 2025, with continued improvement thereafter (previously expected to be close to 13% in 2026 and continue to improve thereafter).

Goldman Sachs has raised its earnings per share forecasts for Standard Chartered for 2025 to 2027 by 3%, 5%, and 4%, respectively, mainly reflecting the impact of lowered tax rate assumptions, while pre-tax profit forecasts remain largely unchanged. The target price for Standard Chartered's Hong Kong stock has been raised by 24% from HKD 135 to HKD 168. The rating remains "Neutral."

Standard Chartered is currently trading at HKD 157.6, up 3.01%, with a turnover of 767,600 shares, involving HKD 120 million