[Click eStock] "KakaoBank, Strong Platform Power... Target Price Maintained"

NH Investment & Securities maintained its buy rating and target price of 37,000 KRW for KakaoBank on the 8th, stating that "loan growth, margins, and provisions are all favorable."

On the same day, Junseop Jeong, a researcher at NH Investment & Securities, said, "KakaoBank's net profit in the fourth quarter of last year was 75.7 billion KRW, a 24.9% increase compared to the same period last year, exceeding market expectations." He added, "Additional provisions amounted to 10.7 billion KRW, which was lower than expected."

The loan growth rate in the fourth quarter of last year was 4.3% quarter-on-quarter, largely influenced by growth in mortgage loans. Researcher Jeong stated, "KakaoBank expects a loan growth rate of 20% this year, which is considered a conservative forecast. Unless there are special variables, higher growth than this is possible."

With an improvement in the loan-to-deposit ratio, the net interest margin (NIM) rose to 2.36%. The loan-to-deposit ratio remained low at only 82%. Margin defense through further improvement in the loan-to-deposit ratio is expected to be possible this year as well.

Researcher Jeong noted, "The proportion of low-cost deposits was 55.3%, down 1.6 percentage points from the previous quarter, but the share of group savings accounts within total deposits expanded to 14.5% compared to before." He added, "The number of subscribers to the new product 'One-Month Savings' exceeds 1 million. Although the decline in the proportion of low-cost deposits requires caution, the platform power, which is the source of low funding costs, is still considered solid."

He further commented, "The recent supply and demand trend centered on low price-to-book ratio (PBR) stocks is a burden on the stock price. However, since clear loan and profit growth is expected this year as well, it is anticipated that this will gradually be reflected in the stock price."