Qudian

Qudian's npls (as % of loans) rose 20.6% yoy to 5.62% in 2Q2019

By Helgi Analytics - September 17, 2019

Qudian's non-performing loans reached 5.62% of total loans at the end of 2019-06-30, up from 4.66% compared to the previous year....

Qudian's market capitalisation (end of period) fell 12.3% to USD 1,957 mil in 2Q2019

By Helgi Analytics - October 23, 2019

Qudian stock traded at JPY 1,645 per share at the end of second quarter of 2019 implying a market capitalization of USD 3,477 mil. ...

Qudian's share price (end of period) fell 22.7% yoy to CNY 44.6 in 2Q2019

By Helgi Analytics - September 5, 2019

Qudian stock traded at CNY 44.6 per share at the end of second quarter of 2019 implying a market capitalization of USD 1,957 mil. Over ...

Profit Statement 2016 2017 2018
Net Interest Income CNY mil 1,004 2,785 2,803
Net Fee Income CNY mil 171 1,109 2,153
Other Income CNY mil 0 0 0
Total Revenues CNY mil 1,175 3,895 4,957
Operating Profit CNY mil 831 3,126 3,961
Provisions CNY mil 133 755 1,295
Net Profit CNY mil 577 2,164 2,491
Balance Sheet 2016 2017 2018
Interbank Loans CNY mil 586 551 0.002
Customer Loans CNY mil 4,827 8,767 9,592
Total Assets CNY mil 7,118 19,380 16,253
Shareholders' Equity CNY mil 2,514 9,540 10,821
Interbank Borrowing CNY mil 4,259 8,489 4,274
Customer Deposits CNY mil 0 0 0
Issued Debt Securities CNY mil 0 0 0
Ratios 2016 2017 2018
ROE % 61.3 35.9 24.5
ROA % 11.8 16.3 14.0
Costs (As % Of Assets) % 7.02 5.80 5.59
Costs (As % Of Income) % 29.2 19.7 20.1
Net Interest Margin % 20.5 21.0 15.7
NPLs (As % Of Loans) % 1.75 4.60 16.7
Provisions (As % Of NPLs) % 186 179 118
Valuation 2016 2017 2018
Market Capitalisation (End Of Period) USD mil 7,291 3,827 1,410
Share Price (End Of Period) CNY 167 81.7 28.5
Price/Earnings (P/E) 87.9 11.5 3.69
Price/Book Value (P/BV) 20.2 2.61 0.849
Earnings Per Share (EPS) CNY 1.90 7.09 7.74
Book Value Per Share CNY 8.27 31.3 33.6

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summary Unit 2014 2015 2016 2017 2018
income statement          
Net Interest Income CNY mil 12.1 5.14 1,004    
Total Revenues CNY mil 15.1 86.6 1,175    
Operating Profit CNY mil -39.1 -186 831    
Net Profit CNY mil -40.8 -233 577    
balance sheet          
Interbank Loans CNY mil ... 34.9 586    
Customer Loans CNY mil ... 2,061 4,827    
Total Assets CNY mil ... 2,676 7,118    
Shareholders' Equity CNY mil ... -631 2,514    
Interbank Borrowing CNY mil ... 1,652 4,259    
Customer Deposits CNY mil ... 0 0    
Issued Debt Securities CNY mil ... 0 0    
ratios          
ROE % ... 36.9 61.3    
ROA % ... -8.71 11.8    
Costs (As % Of Assets) % ... 10.2 7.02    
Costs (As % Of Income) % 359 315 29.2    
Net Interest Margin % ... 0.192 20.5    
Interest Income (As % Of Revenues) % 79.9 5.93 85.4    
Fee Income (As % Of Revenues) % 20.1 94.1 14.6    
Equity (As % Of Assets) % ... -23.6 35.3    
Loans (As % Assets) % ... 77.0 67.8    
NPLs (As % Of Loans) % 0.049 0.918 1.75    
Provisions (As % Of NPLs) % 2,053 165 186    
valuation          
Market Capitalisation (End Of Period) USD mil ... ... 7,291    
Number Of Shares (Average) mil 79.3 79.3 304    
Share Price (End Of Period) CNY ... ... 167    
Earnings Per Share (EPS) CNY -0.514 -2.94 1.90    
Book Value Per Share CNY ... -7.96 8.27    
Price/Earnings (P/E) ... ... 87.9    
Price/Book Value (P/BV) ... ... 20.2    
Earnings Per Share Growth % ... 472 -165    
Book Value Per Share Growth % ... ... -204    
income statement Unit 2014 2015 2016 2017 2018
income statement          
Interest Income CNY mil 21.1 154 1,271    
Interest Cost CNY mil 9.01 148 268    
Net Interest Income CNY mil 12.1 5.14 1,004    
Net Fee Income CNY mil 3.04 81.5 171    
Other Income CNY mil 0 0 0    
Total Revenues CNY mil 15.1 86.6 1,175    
Other Cost CNY mil 54.2 273 344    
Operating Cost CNY mil 54.2 273 344    
Operating Profit CNY mil -39.1 -186 831    
Provisions CNY mil 1.67 45.1 133    
Extra and Other Cost CNY mil -0.003 2.08 -5.07    
Pre-Tax Profit CNY mil -40.8 -233 703    
Tax CNY mil 0 0 127    
Minorities CNY mil 0 0 0    
Net Profit CNY mil -40.8 -233 577    
growth rates          
Net Interest Income Growth % ... -57.5 19,437    
Net Fee Income Growth % ... 2,579 110    
Total Revenue Growth % ... 473 1,257    
Operating Cost Growth % ... 403 26.0    
Operating Profit Growth % ... 375 -547    
Pre-Tax Profit Growth % ... 472 -402    
Net Profit Growth % ... 472 -347    
balance sheet Unit 2014 2015 2016 2017 2018
balance sheet          
Cash CNY mil ... 210 786    
Interbank Loans CNY mil ... 34.9 586    
Customer Loans CNY mil ... 2,061 4,827    
Total Assets CNY mil ... 2,676 7,118    
Shareholders' Equity CNY mil ... -631 2,514    
Liabilities CNY mil ... 3,307 4,604    
Interbank Borrowing CNY mil ... 1,652 4,259    
Customer Deposits CNY mil ... 0 0    
Issued Debt Securities CNY mil ... 0 0    
Other Liabilities CNY mil ... 1,655 345    
asset quality          
Non-Performing Loans CNY mil 0.250 20.8 87.7    
Gross Loans CNY mil 513 2,261 5,020    
Total Provisions CNY mil 5.13 34.2 163    
growth rates          
Customer Loan Growth % ... ... 134    
Total Asset Growth % ... ... 166    
Shareholders' Equity Growth % ... ... -498    
ratios Unit 2014 2015 2016 2017 2018
ratios          
ROE % ... 36.9 61.3    
ROA % ... -8.71 11.8    
Costs (As % Of Assets) % ... 10.2 7.02    
Costs (As % Of Income) % 359 315 29.2    
Net Interest Margin % ... 0.192 20.5    
Interest Spread % ... ... 19.2    
Asset Yield % ... 5.74 26.0    
Cost Of Liabilities % ... ... 6.77    
Interest Income (As % Of Revenues) % 79.9 5.93 85.4    
Fee Income (As % Of Revenues) % 20.1 94.1 14.6    
Other Income (As % Of Revenues) % 0 0 0    
Equity (As % Of Assets) % ... -23.6 35.3    
Loans (As % Assets) % ... 77.0 67.8    
NPLs (As % Of Loans) % 0.049 0.918 1.75    
Provisions (As % Of NPLs) % 2,053 165 186    
Provisions (As % Of Loans) % ... 1.66 3.38    
Cost of Provisions (As % Of Loans) % ... 2.19 3.86    
other data Unit 2014 2015 2016 2017 2018
other data          
Employees ... ... ...    
Clients mil ... ... ...    
Total Loan Book CNY mil 513 2,263 6,332    
On-balance Sheet Loans CNY mil 513 2,261 5,020    
Off-balance Sheet Loans CNY mil 0 0 1,361    
Off-balance Sheet Loans (As % of Total) % 0 0 21.5    
On-balance Sheet Loans (As % of Total) % 100 99.9 79.3    
Average Tenor months ... ... ...    
Outstanding Loan per Borrower (Calculated) CNY ... ... 1,110    
Loan Facilitation Income (As % of Off BS Loans) % ... ... 3.20    
Loan Facilitation Income (As % of Off BS Transactions) % ... ... 1.08    
Loss of Guarantee Liability (As % of off-BS Loans) % ... ... 0.127    
Cost of Risk (incl. Off BS Loans) % 10.6 19.6 7.99    
Equity (As % of Off- and On BS Loans) % ... -27.9 39.7    
Revenue per Client CNY ... ... 260    
Operating Profit per Client CNY ... ... 184    
Pre-Tax Profit per Client CNY ... ... 156    
Loan Origination (On-Balance Sheet) CNY mil 578 4,254 30,222    
Loan Origination (Off-Balance Sheet) CNY mil 0 0 2,009    
Loan Origination (Total) CNY mil 578 4,254 32,231    
Number of Transactions (on-BS) '000 199 2,687 40,599 ... ...
Average Size of Transaction CNY 2,906 1,583 744 ... ...
Loan Facilitation & Servicing Fee CNY mil ... ... 21.8    
Processing and Servicing Cost CNY mil ... ... 0    
Provision for Credit Losses of Contract Assets and Service Fees Receivable CNY mil ... ... 0.861    
Profit on Off-Balance Sheet Loans CNY mil ... ... 20.9    
Volume of Off-Balance Sheet Loans CNY mil ... ... 1,361    
Profit on Off-Balance Sheet Loans (As % of Off-Balance Sheet Loans) % ... ... 3.07    
Profit on Off-Balance Sheet Loans (As % of Pre-Tax Profit) CNY mil ... ... 0.030    

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Qudian's net interest margin rose 10.6% yoy to 17.8% in 2Q2019

By Helgi Analytics - September 5, 2019

Qudian's net interest margin amounted to 17.8% in the second quarter of 2019, down from 20.6% when compared to the previous quarter. Historically, the bank’s net interest margin reached an all time high of 29.2% in 1Q2017 and an all time low of 12.8% in...

Qudian's price/earnings (P/E) fell 57.9% yoy to 3.60 in 2Q2019

By Helgi Analytics - September 5, 2019

Qudian stock traded at CNY 44.6 per share at the end second quarter of 2019 implying a market capitalization of USD 1,957 mil. Since the end of 2Q2014, the stock has appreciated by % implying an annual average growth of 0 %. In absolute terms, the value of the compan...

Qudian's net interest income rose 14.1% yoy to CNY 819 mil in 2Q2019

By Helgi Analytics - September 5, 2019

Qudian generated total banking revenues of CNY 1,935 mil in the second quarter of 2019, up 49.3% when compared to the same period of last year and 5.38% when compared to the previous quarter. Historically, the bank’s revenues containing of interest, fee a...

Qudian's equity (as % of assets) rose 16.5% yoy to 65.6% in 2Q2019

By Helgi Analytics - October 7, 2019

Qudian's Equity reached 65.6% of total assets in the 2Q2019, up from 56.4% for the previous year. As a share of net customer loans, the ratio amounted to 103% at the end of the second quarter of 2019. ...

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Qudian is a Chinese online micro-credit provider, which is backed by Alibaba Group affiliate Ant Financial. The Company was set up in 2014 to facilitate merchandise credit and cash credit to college students on campuses across China. Starting from Nov 2015, Qudian shifted its focus to a broader base of young consumers in China and since Jul 2016, it engaged all borrowers as to its cash and merchandise credit products through online channels. The Company operates through an online platform and all the transaction are facilitated through mobile devices. Borrowers can apply for credit on their mobile phones and receive approval within a few seconds. Approved borrowers are then able to draw down on their cash credit with cash disbursed immediately into their Alipay accounts in digital form. The Company also offers merchandise credit products to finance borrowers’ direct purchase of merchandise offered on its marketplace on installment basis. Its marketplace connects consumers with merchandise suppliers. In 2018, it was offering 14 categories of merchandise from over 1,000 brands covering primarily consumer electronics, home appliances, watches and accessories, sports and outdoor merchandise and luggage. Until the middle of 2019, the Company facilited loans to 76 mil clients with total on- and off-balance sheet loans accounting for RMB 29 bil at the end of June 2019. The Company was listed on the New York Stock Exchange in October 2017 and raised about US$ 900 mil. Phoenix Partners, The Kunlun Group and Ant Financial Services Group were among the largest shareholders in the Company at the end of 2018.

Qudian Logo

Finance

Qudian has been growing its revenues and asset by 285% and 82.5% a year on average in the last 3 years. Its loans and deposits have grown by 67.0% and 0% a year during that time and loans to deposits ratio reached at the end of 2018. The company achieved an average return on equity of 40.6% in the last three years with net profit growing nan% a year on average. In terms of operating efficiency, its cost to income ratio reached 20.1% in 2018, compared to 23.0% average in the last three years.

Equity represented 66.6% of total assets or 113% of loans at the end of 2018. Qudian's non-performing loans were 16.7% of total loans while provisions covered some 118% of NPLs at the end of 2018.

Valuation

Qudian stock traded at CNY 28.5 per share at the end of 2018 resulting in a market capitalization of USD 1,410 mil. Over the previous three years, stock price rose by 0% or 0% a year on average. That’s compared to an average ROE of 40.6% the bank generated for its shareholders. This closing price put stock at a 12-month trailing price to earnings (PE) of 3.69x and price to book value (PBV) of 0.849x in 2018.

Risks

Value of the Company dropped some two thirds from its IPO in 2017 while low valuation multiples suggest the market has serious concerns about the Company’s future in spite of its impressive profitability and growth so far. Sustainability of the Company’s business model, a slowdown in the Chinese economy and loan demand and regulatory and competition pressures are among the biggest risks Qudian faces.