China Merchants Bank Co (3968) Fair Value & Analysis
Financial Services · HK · Market cap HK$1.1T
Fair value as of: Aug 13, 2026
From 6 valuation models · updated yesterday
Fair value updated Aug 13, 2026, revised from HK$85.58 to HK$86.18 (+0.7%) since Jul 7, 2026. Share price +3.8% over the past month.
A solid business, screening 80% undervalued on our models.
What matters now
- The price is below even our cautious bear case (HK$64.63). The market is more pessimistic than our downside scenario.
- Solid quality (57/100) at a price below fair value, the discount is the argument here, not the business quality.
- For a financial, book-value and earnings-based methods matter more than a cash-flow DCF, which fits banks and insurers poorly.
Price vs Fair Value (5 years)
White line = price, green steps = our fair value per fiscal year, dashed = 300-day average. As of Aug 13, 2026.
How to read this chart
60‑month range HK$21.07 – HK$55.29 · fair‑value band HK$64.63 – HK$107.72 · the HK$47.96 price screens below the HK$86.18 fair value. Green steps = our fair value per fiscal year (point-in-time, no hindsight). Dashed = 300-day average. As of Aug 13, 2026.
Analysis
China Merchants Bank Co (3968) currently trades at HK$47.96, while our model-based Fair Value estimate is HK$86.18, implying the stock looks roughly 79.7% undervalued today. The Quality Score stands at 57/100 (solid quality), in the Financial Services sector. Bull case: trading below our estimate, it may offer upside if the fundamentals hold. Bear case: a low price can be a value trap when quality is weak or the data is thin (evidence: high), always confirm before acting.
Over the trailing twelve months, China Merchants Bank Co generated revenue of HK$299B at a net margin of 50.5%. Revenue grew 1.7% year over year. It earns a return on equity of 11.9%. The balance sheet holds a net cash position of HK$916B. Fundamentals as of Aug 13, 2026
Our scenario range runs from HK$64.63 (bear case) to HK$107.72 (bull case); at HK$47.96, the current price sits below that range. Bear and bull are the same models run on conservative and optimistic assumptions (margins, growth, valuation multiples), so a plausible valuation range, not a price target. The share trades about 6% below its 52-week high and 13% above its 52-week low, currently below its 200-day average. For context, the median of 10 Financial Services peers we cover trades at 47% fair-value upside, at 80%, 3968 screens cheaper than that median.
Fair Value models
Each model estimates fair value its own way; the Fair Value above is the evidence-weighted blend. Evidence (0–100) measures how completely this model’s inputs are available: well-fed models carry more weight in the blend. The spread across models is intentional, each one stresses a different value driver; dividend models, for instance, come out structurally low when payout is small.
All 6 models by family
Widest divergence: Multiples (HK$67.64) versus Asset-Based (HK$32.37). Highest evidence: Residual Income (76).
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Key figures & financial health
More key figures
Figures from reported company fundamentals · as of Aug 13, 2026. TTM = trailing twelve months.
Quality Score breakdown
Of which business quality 57 · Market factors (momentum, volatility) 58
Non-valuation factor families (profitability, growth, cashflow, financial strength, momentum …), each academically grounded. Valuation itself sits in the Fair Value and is deliberately excluded here to avoid double-counting.
About the company
China Merchants Bank Co., Ltd., together with its subsidiaries, provides various banking products and services. It operates through Wholesale Finance Business, Retail Finance Business, and Other Business segments. It offers current, demand, time, call, savings, notice, and renminbi accounts.
Full company description
China Merchants Bank Co., Ltd., together with its subsidiaries, provides various banking products and services. It operates through Wholesale Finance Business, Retail Finance Business, and Other Business segments. It offers current, demand, time, call, savings, notice, and renminbi accounts. The company also offers loan products include personal commercial real estate, consumption, housing, and car loans; loans to finance for studying abroad; micro-business loans; mortgage loans for equipment; joint guarantee, special guarantee, and housing mortgage loan; bank acceptance, discount, liquid capital, and fixed asset loans; and loans for vessels. In addition, it offers credit cards; insurance products; open-ended funds; discount and guarantees for commercial bills, redemption of commercial bills, and guaranteed discount for commercial acceptance bills; and financial consultation, debt financing underwriting, merger and acquisition financing, and equity financing and enterprise listing services. Further, the company provides forfeiting and risk participation, escrow, cross-border RMB clearing, and interbank services; and risk and financial management, cross-border RMB and oversea financing, international factoring and settlement, and trade finance services. Additionally, it offers financial leasing and guarantee, investment and wealth management, forex option and gold trading, forex express trading, international, offshore and private banking, custody, pension, and electronic banking services. The company also operates in Hong Kong, New York, London, Singapore, Luxembourg, and Sydney. The company was founded in 1987 and is headquartered in Shenzhen, China.
Company description, as reported by the company or data provider.
Revenue & earnings trend
FY2021 – FY2025 · reported fiscal years
China Merchants Bank Co reported revenue of HK$468B in FY2025 versus HK$450B in FY2021, a compound +1.0%/yr. Reported net income was HK$150B in FY2025, compounding +5.8%/yr from FY2021.
of which total revenue +6.0 pp · buybacks/dilution −0.2 pp
Absolute contributions in percentage points per year; they sum to the EPS growth rate. Start and end points are 3-year averages (details on hover).
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Earlier news
External third-party headlines (Yahoo Finance, Reuters and others), not an editorial selection.
- Industrial And Commercial Bank Of China (SEHK:1398) Tests Repo Based Loans, Is The Stock Still Cheap?
- China's Biggest Banks Launch First Repo-Linked Loans as Lending Rules Evolve
- Thunes and UnionPay International Launch Instant Money Transfers to China's mainland
Peer Group
Banks - Regional · 1086 stocks
How this stock ranks against its industry: the green marker is this stock, the band is the typical 25–75% peer range, and the tick is the median.
Valuation Multiples vs Banks - Regional median · lower = cheaper
Snowflake
Five quick dimensions, each 0 to 100: VALUE (fair-value potential), FUTURE (revenue growth), PAST (return on equity), HEALTH (low debt), DIVIDEND (yield). Green = this stock, grey = typical sector peer.
Values & ESG
Does this company touch areas you may want to avoid? The classification is inferred from sector and industry.
ESG scores are not available for this stock yet. Values and ESG data are contextual and can differ between providers.
Similar stocks
10 more Banks - Regional stocks, each showing price versus our Fair Value estimate (as of Aug 13, 2026).
| Stock | Price | Fair Value | vs Fair Value |
|---|---|---|---|
| PT Bank Central Asia Tbk BBCA | 6,350 IDR | 4,637 IDR | -27% |
| KB Financial Group 105560 | 168,100 KRW | 220,258 KRW | +31% |
| PT Bank Rakyat Indonesia (Persero) Tbk BBRI | 3,110 IDR | 3,792 IDR | +22% |
| PT Bank Mandiri (Persero) Tbk BMRI | 4,130 IDR | 6,067 IDR | +47% |
| Banco Bradesco S.A BBD | 5,120 ARS | 8,400 ARS | +64% |
| Shinhan Financial Group 055550 | 103,800 KRW | 146,032 KRW | +41% |
| Hana Financial Group 086790 | 127,900 KRW | 210,506 KRW | +65% |
| Lloyds Banking Group LYG | 4,138 ARS | 8,275 ARS | +100% |
| Joint Stock Commercial Bank for Foreign Trade of Vietnam, VCB | 59,500 VND | 45,959 VND | -23% |
| Woori Financial Group 316140 | 33,000 KRW | 60,758 KRW | +84% |
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Frequently asked questions
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How we calculate Fair Value
Each company is valued through a stack of independent intrinsic-value models (DCF variants, residual-income, multiples and more), blended into one family-balanced consensus and weighted by how much trustworthy data backs it. A separate quality layer scores the fundamentals. Every input is real reported data, nothing guessed.
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