Recently, Citic Securities Company Limited(600030) released the 2021 annual performance express of Huaxia Fund – the business performance of the first head public offering.
With its excellent asset management ability and platform advantages, Huaxia Fund achieved rapid growth in operating revenue and net profit in 2021, with net profit exceeding 2 billion. According to the announcement, Huaxia Fund achieved an operating revenue of 8.015 billion yuan in 2021, a year-on-year increase of 44.70%; The net profit was 2.312 billion yuan, a year-on-year increase of 44.68%; The scale of assets under management of the parent company was 1661.607 billion yuan, a year-on-year increase of 13.72%.
The net profit of {60001} fund held by the controlling shareholder of Huaxia is calculated as {60001} 3.0} 3.0 {3.0} billion in 2021.
As the head public offering in the industry, the valuation of Huaxia Fund also surfaced recently. On January 5, IgM financial Inc announced that it would acquire 13.9% equity of Huaxia Fund held by power group of Canada at a price of 1.15 billion Canadian dollars in the first half of 2022. Based on this acquisition price, the valuation of Huaxia Fund would be nearly 41.5 billion yuan.
net profit exceeded the 2 billion mark, with a year-on-year increase of nearly 45%
On February 7, Citic Securities Company Limited(600030) issued an announcement to disclose the main financial data of Huaxia Fund in 2021.
According to the announcement, Mackenzie Financial Corporation, the shareholder of Huaxia Fund, a non wholly-owned subsidiary of the company, holds 13.9% of the equity of Huaxia Fund due to IgM financial Inc, the holding company of Mackenzie Financial Corporation. Its 2021 results will be published, which will contain the main financial data of Huaxia Fund. Based on the fair principle of information disclosure, Citic Securities Company Limited(600030) disclosed the main financial data of Huaxia Fund in 2021.
according to the performance express, as of December 31, 2021, the total assets of Huaxia Fund were RMB 16.295 billion and the total liabilities were RMB 5.007 billion; In 2021, the operating revenue was 8.015 billion yuan, up from 5.539 billion yuan in the same period last year, with a year-on-year increase of 44.70%; The net profit was 2.312 billion yuan, breaking the 2 billion mark, with a year-on-year increase of 44.68%; The total comprehensive income was 2.287 billion yuan.
In addition, as of December 31, 2021, the assets under management of the parent company of Huaxia Fund was RMB 1661.607 billion; According to the Citic Securities Company Limited(600030) 2020 annual report, the data in the same period last year was 1461.142 billion yuan, a year-on-year increase of 13.72%.
As the head fund company in the industry, behind the brilliant business performance of Huaxia Fund is the multi-point flowering of the company’s business lines.
According to the data, as of December 31, 2021, there were 13 active equity funds under Huaxia Fund (different types of shares of the same fund are combined) with an annual return of more than 20%. In 2021, there were more than 4701 active funds in China’s top ten stock management industry, among which there were more than 4701 active funds.
In addition, as one of the first fund companies approved fof products, Huaxia Fund has always regarded fof as an important track of the company. It not only ranks first in the number of products in the industry, but also won the annual performance champion of fof products in 2021. Huaxia Jufeng has a steady target of fof’s revenue of 14.57% in 2021.
The trillions of equity ETF market is the main battlefield of Huaxia Fund. Data show that Huaxia Fund is the only fund company with a management scale of more than 200 billion yuan, ranking first among 51 public fund companies with ETF products. Among them, among the 24 equity ETFs with a total market scale of more than 10 billion yuan, Huaxia Fund has 8.
Citic Securities Company Limited(600030) strong alliance with Huaxia Fund
Founded in 1998, Huaxia Fund is one of the “top ten” public offering companies, Citic Securities Company Limited(600030) is now the controlling shareholder of the company. As of the mid-2021 report, Citic Securities Company Limited(600030) holds 62.20% of the equity of Huaxia Fund. Based on this calculation, Huaxia Fund will contribute about 1.438 billion yuan of net profit to Citic Securities Company Limited(600030) in 2021.
Since 2019, the securities industry has fully started the transformation of wealth management, among which the fund management platform is undoubtedly an important support for the transformation of wealth management of securities companies, and the strong combination and mutual achievements of Citic Securities Company Limited(600030) and Huaxia Fund are a model in this wave.
Dongxing Securities Corporation Limited(601198) the non bank team believes that as a public fund platform controlled by Citic Securities Company Limited(600030) , Huaxia Fund’s rapid development not only contributes to the consolidated income of Citic Securities Company Limited(600030) , but also plays an important role in the construction of wealth management platform and business coordination, delivering advanced experience and high-quality products for its own capital investment and asset management business.
For example, in January 2022, Citic Securities Company Limited(600030) relying on its financial technology strength and resource integration ability, launched fortune number and supporting content open platform, built a content ecosystem based on public funds, and provided professional market interpretation, industry analysis, fund investment and education and other full life-cycle services from the perspective of investors, Huaxia Fund is one of the first fund companies to settle in the content platform.
One side is the boss of securities companies and the other is the head public offering. The synergy under the strong combination of Citic Securities Company Limited(600030) and Huaxia Fund is continuously emerging, which is expected to form a “positive feedback” effect of continuous mutual promotion. The Dongxing Securities Corporation Limited(601198) non bank team believes that this “mutual achievement” model between holding fund companies and securities parent companies may become the best paradigm of securities companies’ wealth management system.
Recently, Citic Securities Company Limited(600030) also released the company’s annual performance express in 2021. In 2021, it achieved an operating revenue of 76.570 billion yuan, a year-on-year increase of 40.80%; The net profit attributable to the parent company was 22.979 billion yuan, a year-on-year increase of 54.20%, which significantly broke the record high of the company’s performance (the previous high was 19.8 billion yuan in 2015).
Orient Securities Company Limited(600958) in the review and Research Report on the pre increase of its performance, the non bank team specially mentioned that the company’s asset management scale continues to rank first in the industry and has basically completed the active management transformation. Considering that the company is likely to spin off the asset management business and establish an asset management company, the development of asset management business will enter the fast lane, superimposed on its holding Huaxia Fund, and the company’s large asset management business has broad prospects.
the valuation of Huaxia Fund is about 41.5 billion yuan
In addition to Citic Securities Company Limited(600030) , Huaxia Fund has three major shareholders, namely Mackenzie Financial Corporation of Canada, Power Corporation of Canada and Qingdao Haipeng Technology Investment Co., Ltd., with shareholding ratios of 13.9%, 13.9% and 10% respectively.
On January 5, IgM financial Inc, the controlling shareholder of Mackenzie Financial Corporation, announced that it would acquire 13.9% equity of Huaxia Fund held by Power Corporation of Canada at a cash price of C $1.15 billion (about RMB 5.767 billion) in the first half of 2022. If the acquisition is approved and completed, Wanxin will hold 27.8% equity of Huaxia Fund, ranking the second largest shareholder of Huaxia Fund.
As for why it acquired part of the equity of Huaxia Fund, Canadian IgM publicly said that the acquisition would bring many benefits to its subsidiary Wanxin. For example, by holding a considerable proportion of equity in a Chinese head asset management institution, Wanxin can increase its involvement in China’s asset management industry, enhance the relationship between Wanxin and Huaxia Fund, obtain more business opportunities in China, and strive for more opportunities for Wanxin to distribute products or solutions in China; The centralized ownership of Huaxia Fund by Wanxin can simplify the organizational structure of IgM and Bauer group. For IgM, the financial situation of the company will also be enhanced after the completion of the acquisition.
In addition to the second reason for simplifying the organizational structure, the equity of China’s public fund is indeed very popular. Its relatively stable management fee income will not only make it a “cash cow” for shareholders, but also help foreign shareholders share the dividends of China’s asset management market, which is also the reason why the equity of the head public fund company has always been valuable and has no market.
The acquisition also exposed the valuation of China’s head public offering by international investment institutions. According to the purchase price, Wanxin invested 1.15 billion Canadian dollars in the 13.9% equity of Huaxia Fund, which means that it has given a valuation of about 41.489 billion yuan to Huaxia Fund
