Citigroup has maintained its rating on Qifu Technology (QFIN, Financial) and increased its target price from $31.44 to $37.50. The company's non-GAAP net profit for Q3 2024 reached RMB 1.83 billion, surpassing management's forecast of RMB 1.55-1.65 billion. This robust performance is attributed to significant provision reversals and improved funding costs.
Qifu Technology's asset quality showed further improvement, with key indicators demonstrating a positive trend. The D1 delinquency rate fell to 4.6%, the 30-day collection rate rose to 87.4%, and the 90-day delinquency rate decreased. Despite economic uncertainties in China, Qifu moderately increased provisioning for new loans, which did not impact overall profitability.
In Q3, loans under the light capital model accounted for 55% of total loans, showing growth. A new $450 million repurchase plan aims to enhance shareholder returns, potentially reducing shares by 3% in 2023 and 10% in 2024. Analysts expect Qifu to maintain superior growth and benefit from industry consolidation, making it an attractive investment.
