Core view:
In 2021, the report card of the securities industry was released, and the profitability was proved. On February 25, the China Securities Association released the operating data of securities companies in 2021. In 2021, 140 securities companies in the industry realized an operating revenue of 502.41 billion yuan and a net profit of 191119 billion yuan, with a year-on-year increase of 12.03% and 21.32% respectively. This is also the increase in the revenue and net profit of the securities industry for three consecutive years. By the end of 2021, the total assets of the securities industry were 10.59 trillion yuan and the net assets were 2.57 trillion yuan, an increase of 19.07% and 11.34% respectively over the end of the previous year.
In terms of investment banking business, the number of initial listings on the science and innovation board and gem accounted for 75.05% of the number of IPOs in the whole year, and the financing amount accounted for 65.48% of the total IPO Financing in the whole year, indicating that the status of the two boards in the equity financing market has been further improved.
In terms of wealth management: by the end of 2021, the securities industry had opened 298 million A-share capital accounts for customers, with a year-on-year increase of 14.89%. The ending balance of customer transaction settlement funds (including credit transaction funds) was 1.90 trillion yuan, an increase of 14.66% over the end of the previous year, and the customer base continued to expand. The net income from agency sales of financial products was 20.69 billion yuan, a year-on-year increase of 53.96%, and the proportion of income in brokerage business income also increased to 13.39%, an increase of 3.02 percentage points.
In terms of asset management business, at the end of 2021, the scale of asset management business in the securities industry was 10.88 trillion yuan, an increase of 3.53% year-on-year. In particular, the scale of collective asset management represented by active management increased significantly by 112.52% to 3.28 trillion yuan. In the whole year, the net income from asset management business was 31.786 billion yuan, a year-on-year increase of 6.10%.
Securities industry perspective
Recently, the average daily turnover of the two cities has returned to trillion, and the pressure of short-term brokerage business / wealth management business has been relieved. At the same time, the reform and innovation of the securities industry in recent years, such as fund investment adviser / new regulations on asset management / the implementation of comprehensive registration system, will greatly stabilize the performance fluctuation of the securities industry, and the short-term market fluctuation will not change the good momentum of the medium and long-term performance of the securities industry.
In the long run, we believe that the supporting logic of the performance growth of the securities industry lies in:
(1) the increase in performance brought about by the transformation of brokerage business to wealth management mode is mainly due to the constant trend of residents’ deposits from banks that bring lower returns and liquidity to the stock market that can bring higher returns and high liquidity, superimposed by the expansion of the pilot fund investment adviser of securities companies and the increase in residents’ demand for active management business, The holding scale of the fund is expected to be steadily improved to provide a steady stream of performance support for securities companies.
(2) the performance increment contributed by the new market places bred by innovative business, such as the expansion of securities lending scale, the strong demand for derivatives business inside and outside the market, the exploration of securities settlement fund model and the popularization of “investment bank + investment” two wheel driven business model, will raise the performance level of securities companies. From the perspective of the whole securities industry, the above growth support logic will provide a new revenue growth point for the whole industry; For large-scale securities companies, it will further develop in the strategic direction of building aircraft carrier level securities companies in the country; For small and medium-sized securities companies, their exhibition direction and ability will benefit from the new blue ocean market and earn differentiated income.
Recommended target: securities companies with strong wealth management ability: Gf Securities Co.Ltd(000776) , Guolian Securities Co.Ltd(601456) , China Industrial Securities Co.Ltd(601377) (: not covered in depth)
Risk tip: the effect of policy implementation is less than expected or even tightened, liquidity is tightened, stock based turnover has fallen sharply, and the overall market downside risk.
