<P align=left><FONT size=5>JP 摩根：China Daily Views </FONT></P>
<P align=left><FONT size=5>Asia Pacific Equity Research</FONT></P>
<P align=left><FONT size=5>20 March 2007 49页</FONT></P>
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<P>China Minsheng Banking<BR>Upgrade<BR>Overweight<BR>Previous Rating: Neutral<BR>Entering new growth phase, upgrade to OW Rmb11.90<BR>19 March 2007<BR>Price Target: Rmb14.50<BR>China<BR>Banks<BR>Samuel ChenAC<BR>(852) 2800-8557<BR><a href="mailto:samuel.s.chen@jpmorgan.com" target="_blank" >samuel.s.chen@jpmorgan.com</A><BR>Sunil Garg<BR>(852) 2800-8518<BR><a href="mailto:sunil.garg@jpmorgan.com" target="_blank" >sunil.garg@jpmorgan.com</A><BR>2<BR>6<BR>10<BR>14<BR>Rmb<BR>Mar-06 Jun-06 Sep-06 Dec-06 Mar-07<BR>Price Performance<BR>600016.SS share price (Rmb<BR>R-CHIP (rebased)<BR>YTD -1M -3M -12M<BR>Absolute 8.1% -16.2% 21.6% 211.3%<BR>Relative 20.0% -7.7% 23.0% 169.1%<BR>Source: RIMES, Reuters.<BR>China Minsheng Banking (Reuters: 600016.SS, Bloomberg: 600016 CH)<BR>Year-end Dec (Rmb in mn) FY04A FY05A FY06A FY07E FY08E<BR>Operating Profit 4,202 5,699 7,395 10,557 14,532<BR>Net Profit 2,007 2,738 3,758 5,383 8,351<BR>EPS (Rmb) 0.20 0.27 0.37 0.46 0.62<BR>Diluted EPS (Rmb) 0.20 0.27 0.37 0.46 0.62<BR>DPS (Rmb) 0.04 0.05 0.00 0.07 0.12<BR>EPS growth (%) 43.2% 34.5% 36.8% 24.8% 35.4%<BR>ROE (%) 17.9% 19.4% 21.6% 17.5% 15.1%<BR>P/E (x) 59.2 44.0 32.2 25.8 19.0<BR>BVPS (Rmb) 1.26 1.52 1.90 3.46 4.96<BR>P/BV (x) 9.5 7.8 6.3 3.4 2.4<BR>Div. yield (%) 0.3% 0.4% 0.0% 0.6% 1.0%<BR>52-week range (Rmb) 14.07 - 3.43<BR>Market cap (Rmb mn) 112,143<BR>Market cap ($ mn) 14,498<BR>Shares outstanding (mn)<BR>Fiscal Year End Dec<BR>Price (Rmb) 11.90<BR>Date Of Price 19 Mar 07<BR>Avg daily value (Rmb mn) 1,589.2<BR>Avg daily value ($ mn) 205.5<BR>Avg daily vol (Rmb mn) 241,777.0<BR>R-CHIP 9,113<BR>Exchange Rate 7.74<BR>Source: Company data, Reuters, JPMorgan estimates.<BR>J.P. Morgan Securities (Asia Pacific) Limited<BR>See page 47 for analyst certification and important disclosures, including investment banking relationships.<BR>JPMorgan does and seeks to do business with companies covered in its research reports. As a result, investors should be aware that the firm<BR>may have a conflict of interest that could affect the objectivity of this report. Investors should consider this report as only a single factor in<BR>making their investment decision.<BR>• Top pick among A-share banks: We upgrade Minsheng to<BR>Overweight with a new Dec-07 price target of Rmb14.5. We<BR>believe the bank will continue to deliver robust profit growth<BR>(43% CAGR, EPS CAGR 30%) in the next three years through<BR>organic growth as well as M&amp;A, and revenue diversification.<BR>Minsheng replaces SPDB as our top pick among A-share banks.<BR>• We believe incrementally the bank may acquire growth<BR>through takeover of city commercial banks, which typically has<BR>low L/D ratio and thus help improve Minsheng’s funding.<BR>Meanwhile, we expect its aggressive revenue diversification;<BR>focus on trade finance and SME banking to improve profitability.<BR>• 2006 profit up 37%, earnings forecasts raised. 2006 profit was<BR>8% above our estimate. We updated our model to reflect its recent<BR>A-share placement and planned H-share offering. We believe its<BR>strengthening capital base will support Minsheng’s M&amp;A as well<BR>as geographic expansion. In light of better NIM, fee business<BR>expansion and strong macro-condition, we revised up 2007<BR>earnings by 12% and 2008 profit by 22%.<BR>• Our new DDM-based Dec-07 price target is Rmb14.5,</P>