Balance has become the biggest feature of the revenue structure in China Merchants Securities Co.Ltd(600999) 2021.
According to the annual report released on March 27, China Merchants Securities Co.Ltd(600999) 2021 achieved an operating revenue of 29.429 billion yuan, a year-on-year increase of 21.22%; The net profit was 11.645 billion yuan, a year-on-year increase of 22.69%. Compared with the overall industry data released by China Securities Association, it shows that its revenue growth rate significantly exceeds the industry average, but the net profit growth rate is basically consistent with the industry as a whole.
From the perspective of revenue structure, the revenue of each business segment increased year-on-year, and the growth rate was quite balanced, basically between 10% and 20%. However, in the annual report of fine products, it is not difficult to find that China Merchants Securities Co.Ltd(600999) has many highlights worthy of attention in terms of business segments. For example, in 2021, China Merchants Securities Co.Ltd(600999) company’s net income and ranking of financial products sold on a commission basis reached a record high; Less than two months after the fund investment advisory business was launched, the signing scale was close to 2.4 billion yuan; The asset scale of private securities trading was close to 330 billion yuan, with a year-on-year increase of 57.39%
product consignment revenue hit a record high
According to the data, China Merchants Securities Co.Ltd(600999) 2021 achieved an operating revenue of 29.429 billion yuan, a year-on-year increase of 21.22%; The net profit was 11.645 billion yuan, a year-on-year increase of 22.69%. Compared with the data of China Securities Association, the total revenue of the securities industry in 2021 increased by 12% year-on-year; Net profit increased by 21% year-on-year, indicating that its revenue growth rate significantly exceeded the industry average, but the net profit growth rate was basically consistent with the industry as a whole.
In terms of revenue structure, the revenue of China Merchants Securities Co.Ltd(600999) wealth management and institutional business in 2021 was 13.707 billion yuan, accounting for 46.58%. Although it decreased by 1.19 percentage points over last year, it still supported almost half of the overall revenue. According to the data, the number of new accounts opened in China Merchants Securities Co.Ltd(600999) 2021 hit a record high, with a year-on-year increase of 81.77%. At the end of 2021, China Merchants Securities Co.Ltd(600999) customers numbered about 14.79 million, with a year-on-year increase of 29.07%; The assets of entrusted customers were 4.45 trillion yuan, a year-on-year increase of 16.51%.
Although stock based trading is still constrained by the downward commission rate of the industry, China Merchants Securities Co.Ltd(600999) ‘s product consignment business has hit a record high in net income. According to the data of China Infrastructure Association, in 2021, the net income of China Merchants Securities Co.Ltd(600999) agent trading securities business (including seat leasing) ranked third, and the net income of financial products sold on a commission basis ranked fifth, with a year-on-year increase of 2. At the end of the reporting period, the ownership of customers’ financial products also increased by 17.89% year-on-year.
China Merchants Securities Co.Ltd(600999) 2021 at the end of the year, the number of wealth management clients reached 563500, and the assets of wealth management clients reached 1.67 trillion yuan, an increase of 24.12% and 21.90% respectively year-on-year, including 30600 high net worth clients, an increase of 26.97% year-on-year. In particular, it is worth mentioning that China Merchants Securities Co.Ltd(600999) was officially launched on November 8 last year, but by the end of 2021, the signing scale had been nearly 2.4 billion yuan.
In the annual report, China Merchants Securities Co.Ltd(600999) attributed the growth of wealth management business to building a preferred product system, expanding the scale of wealth consulting team, establishing a layered service system for investment advisers, and strengthening the ability of buyer’s investment advisers… However, it is worth noting that China Merchants Securities Co.Ltd(600999) also made a fruitful attempt to expand private domain traffic – the data show that in 2021, China Merchants Securities Co.Ltd(600999) has served more than 2.9 million users through the wechat ecosystem (applet, enterprise wechat and China Merchants Securities Co.Ltd(600999) app). The monthly number of active users of APP has increased by 15.45% year-on-year, ranking among the top 5 large securities companies.
asset management companies’ active management accounts for 83%
In 2021, the rectification of the asset management industry is coming to an end. The asset management business of securities companies accelerated the transformation of public offering, improved the ability of active management, and the head effect continued to increase. During the reporting period, the revenue of China Merchants Securities Co.Ltd(600999) investment management business segment increased by 13.24% year-on-year. The company explained that the main factor is the increase in the scale of assets actively managed by the company’s investment promotion and asset management, which drives the growth of management fee income.
Fully promoting the construction of active management capacity is the core task of China Merchants asset management in 2021. According to the data, by the end of 2021, the active management scale of China Merchants asset management (excluding the special asset management plan) was 346413 billion yuan, a year-on-year increase of 29.72%, accounting for 82.87%, a year-on-year increase of 26.99 percentage points.
At the same time, China Merchants asset management is also continuing to strengthen coordination with the parent company’s wealth management line and further strengthen customer stickiness, including launching diversified and customized product schemes, consolidating the advantages of institutional characteristics, integrating advantageous resources, issuing “China Merchants private equity 50 Index enhanced fof series products” and linking China merchants private equity fund index products to provide customers with one-stop low-cost private equity fund allocation services.
According to the statistics of China Securities Association and China Foundation Association, at the end of 2021, the scale of China Merchants asset management compliance entrusted fund management ranked 520th in the industry, and the average monthly scale of private placement actively managed assets ranked fourth in the industry in 2001.
In addition to investment promotion and asset management, Boshi fund and investment promotion fund of China Merchants Securities Co.Ltd(600999) group also continued to maintain considerable growth. According to the data, by the end of 2021, the asset management scale of Boshi Fund (excluding subsidiaries, the same below) was 1655.3 billion yuan, of which the management scale of public funds (excluding feeder funds, the same below) was 989.2 billion yuan, with a year-on-year increase of 25.45% and 38.81% respectively; The asset management scale of China Merchants Fund was 1080 billion yuan, of which the asset management scale of public funds was 741 billion yuan, with a year-on-year increase of 37.71% and 47.21% respectively.
At the same time, with the accelerated transformation of standardized products of bank financial management, trust companies and third-party wealth companies, custody outsourcing business also ushered in greater development space China Merchants Securities Co.Ltd(600999) said that the company’s custody outsourcing business actively explored new business forms, new products and new services, continued to consolidate its leading position in the industry, and became the first securities company in the market to sign an operation outsourcing service agreement with foreign public funds.
By the end of 2021, China Merchants Securities Co.Ltd(600999) managed outsourcing products had 35400 units and a scale of 3.60 trillion yuan, with a year-on-year increase of 34.74% and 25.55% respectively. According to the data, the market share of the company’s private fund custody products reached 23.17%, and the number of private fund custody products and public fund custody products remained the first in the industry for eight consecutive years.
single business is difficult to achieve upward breakthrough
In the annual report, China Merchants Securities Co.Ltd(600999) made it clear that the internal and external business situation it faces in 2022 is still complex.
The all-round competition will promote the continuous upgrading of the service mode of the securities industry. The industry competition jointly promoted by leading securities companies, foreign financial institutions and cross domain institutions is becoming more and more intense. It is difficult to achieve an upward breakthrough in operating performance by relying on a single business or product. The comprehensive service mode of “customer-centered” will become a new driving direction of the securities industry.
Therefore, China Merchants Securities Co.Ltd(600999) stressed the need to “expand capital light business and strengthen asset heavy business”, do a good job in the coordinated development of service business and asset use business, and constantly improve the level of roe.
In terms of asset light business, investment banking business is the key direction: first, on the basis of adhering to “quality first”, seize business opportunities such as comprehensive registration system, normalization of IPO and additional issuance, M & A and public offering REITs, and take multiple measures to expand revenue; Second, accelerate the construction of platform management, accelerate the localization construction and the layout of key areas; Third, adhere to “what the country needs and what the securities can do”, focus on “self-reliance and self-improvement of service technology, self-control of service industry chain supply chain, peak carbon neutralization of service carbon”, and improve the ability to serve the national strategy.
In terms of wealth management and institutional business, we will continue to expand the scale of customer assets, optimize customer investment income and strengthen wealth management income; Strengthen the construction of comprehensive service capacity of institutional customers and do a good job in the in-depth excavation of customers’ comprehensive value; The trusteeship business will focus on “making every effort to expand the scale of trusteeship outsourcing” and strengthen innovation to ensure its leading position in the industry; Capital intermediary business will balance the relationship between risk and return, seek progress in stability and achieve high-quality development.
In terms of investment management business, it is planned to further expand the scale of active management and enhance the ability of equity investment; Create more star products and form a new driving force for scale growth; Create characteristic product lines and form differentiated competitive advantages.
In the field of heavy capital, China Merchants Securities Co.Ltd(600999) hopes to do a good job in the allocation of large categories of assets in terms of investment and trading business, continue to strengthen directional investment ability, strengthen the construction of credit system, comprehensively investigate credit risks and maintain the stability of scale and income under the guidance of “stable style, diversified strategies, leading scale and efficient coordination”; Vigorously develop customer demand driven business, further improve the scale of neutral strategy investment business, optimize income structure and thicken investment income.
