Industrial Bank (601166.SH) Hot Drivers and Prospects Analysis

Industrial Bank’s wholly-owned subsidiary, Industrial Bank Financial Asset Investment Co., Ltd., was approved to open with a registered capital of 10 billion yuan, becoming the first joint-stock bank Financial Asset Investment Company (AIC) in China [1]. This subsidiary will carry out debt-to-equity swaps and related businesses, support science and technology innovation enterprises and private enterprises, serve the development of new quality productive forces, and is expected to bring new profit growth points for the company.

In the first three quarters of 2025, Industrial Bank achieved operating income of 161.234 billion yuan and net profit of 63.083 billion yuan, a year-on-year increase of 0.12% [2][3]. The increased activity in the capital market drove the growth of third-party custody business, with the average monthly number of signed customers reaching more than twice the average monthly number in the first half of the year [0].

The stock price performed excellently in 2025, with a year-to-date increase of 33.04% and a 52-week price range of 15.68-25.45 yuan [5]; Trading volume was active, with an average 3-month trading volume of 66.99 million shares, and daily trading volume often exceeded 50 million shares [3]; The current market value is about 477.22 billion yuan, a significant increase from the beginning of the year [2].

The banking sector has recovered overall, with the CSI Bank Index rising 1.69% cumulatively since the fourth quarter [8]; The net interest margin improvement exceeded expectations; the net interest margin of listed banks expanded by 3 basis points month-on-month in the first quarter of 2025 [0], providing support for the improvement of industry performance.

1. Differentiated Competitive Advantage
   : As the first joint-stock bank AIC, Industrial Bank has a first-mover advantage in the debt-to-equity swap field and is expected to gain more business opportunities in serving the real economy and resolving corporate debt risks.
2. Business Synergy Effect
   : The growth of third-party custody business reflects the company’s synergy between retail finance and capital market businesses; as the capital market remains active, this business is expected to further contribute to revenue.
3. Valuation Repair Potential
   : The stock price rose significantly in 2025, but it is necessary to evaluate whether there is still room for repair in combination with valuation indicators such as price-earnings ratio [2][6].

• New growth points brought by AIC business expansion;
• Sustained benefits from the recovery of the banking sector and net interest margin improvement;
• Stable dividend policy attracts long-term investors (a dividend plan of 10 yuan per 10 shares was implemented in June 2025 [0]).

• Macroeconomic fluctuations may affect the asset quality of the bank;
• The process of interest rate liberalization may put pressure on the net interest margin;
• There are policy and market uncertainties in the development of AIC business.

The core drivers of Industrial Bank becoming a hot stock recently include policy breakthroughs (the first joint-stock bank AIC), stable performance, business synergy growth, and industry environment improvement. The stock price performed strongly, with a year-to-date increase of 33.04% and a significant increase in market value. In the future, attention should be paid to the progress of AIC business, changes in net interest margin, and the impact of macroeconomics on the banking sector.