\u3000\u3 Jointo Energy Investment Co.Ltd.Hebei(000600) 030 Citic Securities Company Limited(600030) )
Event: the company released its 2021 annual report, realizing a revenue of 76.5 billion yuan, a year-on-year increase of 40.7%; The net profit attributable to the parent company was 23.1 billion yuan, a year-on-year increase of 55.0%; The net assets attributable to the parent company were 209.2 billion yuan, a year-on-year increase of + 15.1%
Key investment points
The net profit attributable to the parent company reached a new high, and the balanced development of performance led to a high increase in roe: 1) in 2021, the net profit attributable to the parent company was + 55% year-on-year, reaching 23.1 billion yuan; In terms of absolute scale, it has exceeded the net profit attributable to the parent company in 2015, reaching the highest level since its establishment. The company’s business continued to develop, with net interest income of + 106% year-on-year to 5.3 billion yuan; The net income of asset management business was + 46% to RMB 11.7 billion year-on-year, mainly due to the net income of fund management business was + 46% to RMB 8.1 billion year-on-year. 2) In 2021, the company’s financial market business continued to develop, and the income from changes in fair value increased significantly to 5.3 billion yuan (from – 6.4 billion yuan at the end of 2020), mainly due to changes in the fair value of financial instruments caused by fluctuations in the securities market; The fair value of the company’s derivative financial instruments increased to 22.4 billion yuan (2020: – 21.3 billion yuan). 3) In 2021, the continuous high boom of market transactions and favorable policies driven the balanced development of various businesses of the company, driving the roe of the company to reach 11.82% (the same period in 2020: 8.68%).
Under the high market boom, wealth management continues to develop, and HENGQIANG, a strong investment bank, is expected to deeply benefit from the comprehensive registration system: 1) the brokerage market share continues to increase, and wealth management has achieved initial results. In 2021, the average daily turnover of the market stock base reached 1133.9 billion yuan (year-on-year + 25%). Under the background of high market prosperity, the share of the company’s stock base market increased to 6.97% (2020: 6.13%), driving the net income of brokerage business + 24.1% year-on-year to 13.96 billion yuan. Among them, the net income from selling financial products on a commission basis reached 2.66 billion yuan (year-on-year + 35%), accounting for 19% of the net income from brokerage (17% in 2020). The transformation of the company’s wealth management has been effective. The number of corporate customers has accumulated more than 12 million, the asset scale of custody customers has increased by 29% to 110000 yuan year-on-year, and the asset scale of high net value customers (more than 6 million yuan) has increased by 29% to 35000 year-on-year. 2) The public offering reform of Daji continued to advance, and Huaxia Fund continued to contribute wealth management dividends. Compared with the end of 2020, the scale of the collective asset management plan is + 154% to 660.5 billion yuan, and the net income of asset management business is + 46% to 11.7 billion yuan year-on-year (including the management fee income of the collective asset management plan is + 47% to 1.8 billion yuan year-on-year). In addition, with the development of gold in the equity market, Huaxia Fund management business has grown rapidly. By the end of 2021, the asset management scale of Huaxia Fund had reached 1661.6 billion yuan (year-on-year + 14%), of which the management scale of public funds had reached 1038.4 billion yuan (year-on-year + 29%). 3) Under the background of multi-level capital market construction, the leading effect is prominent, and the business scale of Citic Securities Company Limited(600030) investment banking continues to lead. In 2021, the company achieved a net investment banking revenue of 8.2 billion yuan (year-on-year + 19%), mainly due to the IPO underwriting scale of + 91% year-on-year to 85 billion yuan, and the market share increased significantly to 15.7% (same period in 2020: 9.5%); The amount of bond underwriting increased by 20.0% year-on-year to 1565.5 billion yuan (the market share reached 13.74%); The refinancing scale remained stable (year-on-year + 0.2%) to 214 billion yuan, accounting for 22.3% of the market; The business scale of investment banking ranks first in the industry, and the leading advantage remains stable. We expect that under the main tone of comprehensively promoting the registration system in 2022, Citic Securities Company Limited(600030) is expected to give full play to its leading and platform advantages, strengthen the ability of equity underwriting and continuously improve the business synergy of the industrial chain of large investment banks.
The landing of allotment of shares will enhance the strength of capital intermediary business, and roe is expected to gain new impetus to rise upward. 1) On January 27 and March 3, 2022, Citic Securities Company Limited(600030) respectively released the results of a & H share allotment. The allotment company raised a total of 27.33 billion yuan (28 billion yuan to be raised), which led to the increase of the company’s share capital to 14.8 billion shares, and the capital strength was further supplemented. 2) Previously, the company’s plan for raising funds and allocating funds indicated that it planned to invest no more than 19 billion yuan to develop capital intermediary business (mainly margin trading and derivatives business). By 2021, the company’s financing funds had increased significantly by 51% year-on-year to 10.2 billion yuan. We expect that with the landing of capital funds Citic Securities Company Limited(600030) will pay close attention to the development opportunities of capital market, and the capital intermediary business is expected to become a new driving force for the rise of roe center.
Profit forecast and investment rating: we expect that with the steady progress of the registration system and the continuous optimization of capital market reform, Citic Securities Company Limited(600030) as a leading securities firm, is expected to seize the opportunity, and the strong will always be strong. We basically maintain the forecast of net profit attributable to parent company from 2022 to 2023 of RMB 27.043/32.310 billion, and the net profit attributable to parent company in 2024 is expected to reach RMB 38.798 billion, corresponding to EPS of RMB 2.09/2.50/3.00 from 2022 to 2024, and the current market value corresponds to P / b1.00 from 2022 to 202422 / 1.14/1.08x, maintaining the “buy” rating.
Risk tips: 1) market transaction activity decreases; 2) Stock market fluctuations impact the return on proprietary investment. 3) Stricter supervision inhibits the development of innovative business.
