Capitec Bank Holdings (CPIJ.J): Upgrading estimates/target price, expecting special dividend in FY28 – remains Buy rated

Research evidence excerpt

Capitec Bank Holdings (CPIJ.J): Upgrading estimates/target price, expecting special dividend in FY28 – remains Buy rated

Capitec Bank Holdings (CPIJ.J)

01 July 2026 Citi Research

Upgrading earnings estimates by +7-11%, see +17% 3-year CAGR in HEPS

We refresh our earnings our earnings model upgrading our HEPS forecasts by +7% this year, +9% next year and by +11% in

FY29. The upward revision to our forecasts is driven by lower OPEX following better than expected cost cost containment in

FY26, more optimistic estimates of net transaction fee income from more upbeat expectations of growth in VAS and Capitec

Connect (MVNO) revenue from new products (e.g. bus tickets and cross boarder payments) and new distribution channels (e.g.

selling VAS through the business bank), and higher net interest income (NI) as we incorporate a revised interest rate view and

factor in the positive impact on NII of growing the higher margin merchant finance business bank lending, as well as an upbeat

view on lending generally.

Figure 1. Capitec – HEPS (Rand) Figure 2. Capitec – HEPS growth yoy (%)

© 2026 Citigroup Inc. No redistribution without Citigroup’s written permission.

Source: Company Reports and Citi Research Estimates © 2026 Citigroup Inc. No redistribution without Citigroup’s written permission.

Source: Company Reports and Citi Research Estimates

Slightly higher NII forecast this and next fiscal year

We revise our interest rate expectations and now factor in two 25bp rate hikes this calendar year (previously we expected cuts),

including the May-26 hike, into our earnings model. In 2027 we factor in two 25bp rate cuts and in 2028 an additional three

25bp cuts and one more 25bp cut in the beginning of 2029. The higher rate trajectory versus our earlier expectations has a