Analysts predict a 40% rise in Halyk Bank's stock price and the highest dividends in the region
Halyk's positions are not under threat at this time / Photo: Nurlan Tastanbekov / Shutterstock.com
The Wood&Company investment group has raised its price target for Halyk Bank to $47.7 per depositary receipt, with a 40% upside potential. At the time of publication, the price stood at $34; the previous target of $28.8 was set in April 2025, when the depositary receipt on the London Stock Exchange (LSE) was trading at $22.9.
“Halyk is the clear leader in Kazakhstan’s banking sector, with a 30% market share in 2025, offering the highest dividends among banks in the Caucasus and Central Asia (CCA), projected at 15–16% for 2027–28,” the report states.
"Halyk shares are trading at 1.1 times expected year-end capital
(P/BV) and a price-to-earnings ratio (P/E) of 4.1—which represents significant discounts of 49% and 45%, respectively, compared with comparable CCA banks (Lion Finance Group, TBC Bank, and Kaspi.kz), —the analysts explain their viewpoint.—We believe the upcoming base rate cuts are the main factor that will lead to a revaluation of Halyk shares in the future. Given the company’s attractive valuation, combined with the expected recovery in earnings and a double-digit dividend yield, we consider current levels to be an attractive entry point.”
The authors note that the bank is currently adapting to new regulatory conditions, in particular the legislative cap on fee and commission income (F&C), rising operating expenses amid a VAT increase, and a temporary buildup of retail non-performing loans (NPLs) due to a moratorium on their sale to collection agencies. Consequently, the bank’s profit may decline by 1% in 2026 but should then rebound to 9% in 2027 and 8% in 2028.
Wood&Company is an investment bank focused on the markets of Central and Eastern Europe, as well as emerging markets. Its headquarters are located in the Czech Republic. The company served as a joint bookrunner for the initial public offerings of Air Astana, Kaspi.kz, and NAC “Kazatomprom.”
The pressure is subsiding
Wood&Company writes about the expected cycle of monetary policy easing in Kazakhstan: According to their forecast, the National Bank will lower the base rate to 16% in 2026 (currently 16.25%) and to 14.5% in 2027. This will reduce Halyk’s net interest margin (NIM) from 6.9% in 2026 to 6.8% and 6.7% in the following two years. “However, Halyk’s liabilities tend to be revalued faster than its assets, which should mitigate the initial impact of rate cuts,” the experts note. “Combined with continued double-digit growth in the loan portfolio and high operational efficiency, this should allow the bank to maintain a high return on equity (ROE)—around 27.3% in 2026–2028.”
They expect the bank to maintain a 30% share of the Kazakhstani credit market. Corporate lending will be the driver (12% in 2025–2028), while in the retail segment, Halyk will remain “more selective” (10%), prioritizing asset quality over market share growth.
All of this should enable Halyk to generate capital faster than is required to maintain its capital adequacy ratio. Given the 19% ratio as of the end of the first half of 2026—with regulatory requirements ranging from 9.5% to 12%—dividends are expected to stabilize at 60% of earnings, resulting in a dividend yield of 15–16% in tenge in 2027–2028—compared to a maximum of 9.1% at comparable banks in the region.
Broad base
Wood’s study notes that Halyk’s market share of loans declined from 33% in 2024 to 30% by the end of the first half of 2026. Its share of deposits declined from 2022 to 2024—from 33% to 29%—but then stabilized. Analysts attribute these losses primarily to the growth of Kaspi, whose market share has risen from 13% to 18% and from 11% to 17%, respectively, since 2021.
“We do not necessarily view Halyk’s declining market share as a sign of a weakening position. Rather, it reflects the bank’s much broader customer base and its consistent focus on profitable growth rather than market share,” the authors insist. Among other things, they note that Halyk accounts for about half of all corporate loans, and its client base includes 86% of Kazakhstan’s largest taxpayers—while the volume of payments processed through the bank exceeds the country’s GDP.
On October 8, 2026, Halyk depositary receipts on the LSE (each representing 40 shares) closed at $32.3, down about 1% from the previous day. On the KASE that day, Halyk shares fell 1.06% to 368.3 (0.82 at the National Bank’s exchange rate).
This summer, the British investment bank Cavendish, using roughly the same logic, projected that Halyk’s stock price would rise from 380 tenge—the price at that time—to 679 tenge by the end of 2026.
This article was AI-translated and verified by a human editor
