\u3000\u30 Shenzhen Quanxinhao Co.Ltd(000007) 76 Gf Securities Co.Ltd(000776) )
Event: the company disclosed its 2021 annual report, realizing an operating revenue of 34.2 billion yuan (YoY + 17%), a net profit attributable to the parent company of 10.9 billion yuan (YoY + 8%), and roe 10.5% 67%（YoY+0.07pct.）， EPS1. 42 yuan (YoY + 8%).
We believe that the company’s highlights include: 1) the company’s roe and leverage have increased steadily, which is better than the industry; 2) The scale and performance of asset management increased significantly, and the performance contribution of public funds increased to 23%; 3) The transformation of wealth management has improved. The scale of consignment funds is + 44% year-on-year, and the holding volume is leading in the industry. 4) The investment bank can be repaired in 2022.
Overall: 1) the company’s roe level reached 10.67%, increased by 0.1pct, better than the industry (7.83%); 2) The leverage ratio of the company was 3.75 times, with a year-on-year increase of 0.23 times, higher than that of the industry (3.38 times); 3) According to the business division of the traditional five sectors, in terms of income structure, the asset management sector of the company accounts for the highest proportion, up to 29%. In addition, brokerage, investment, credit and investment banking account for 23%, 17%, 14% and 1% respectively; In terms of growth rate, the growth rate of asset management is up to + 51%, that of brokerage and credit is + 21% and + 16%, and that of self-supporting and investment banking is down year-on-year, with – 15% and – 33% respectively.
The transformation of wealth management has accelerated, and the consignment business has made remarkable progress. 1) In terms of traditional agency trading of securities, the turnover of the company’s stock base was 21 trillion, a year-on-year increase of + 23%, accounting for 3.86% of the market, down 0.1pct; 2) In terms of financial assets sold on a commission basis, the company achieved a revenue of 1.1 billion yuan, a year-on-year increase of + 85%. The scale of financial assets sold on a commission basis was 631.1 billion yuan, a year-on-year increase of + 4%, of which the scale of fund sold on a commission basis was + 44% to 105.7 billion yuan, the scale of holding was + 17% year-on-year, and the scale of non commodity base guarantee ranked third. 3) In terms of margin trading, by the end of 2021, the scale of the company’s two financing business was 94 billion yuan, a year-on-year increase of + 12%, accounting for 5.13% of the market, down 0.1pct.
The scale of asset management increased rapidly, and the performance contribution of public funds was further improved. 1) In the asset management sector of securities companies, by the end of 2021, the total asset management scale of the company had reached 493.2 billion yuan, a year-on-year increase of + 62%, of which the collective asset management scale had increased by + 158% to 353.6 billion yuan, and the single and special asset management scale had increased by – 14% and – 31% year-on-year respectively. The asset management structure was further optimized. 2) In the public fund sector, by the end of 2021, GF had achieved a net profit of 2.6 billion yuan, a year-on-year increase of + 43%, and the scale of public funds increased by + 48% to 1129.7 billion yuan; E fund realized a net profit of 4.5 billion yuan, a year-on-year increase of + 65%, and the fund scale increased by + 39% year-on-year to 1706.4 billion yuan. The contribution of GF and e fund to the company’s net profit increased to 22.6%, an increase of 1.4pct. 3) In terms of private equity, GF Xinde managed nearly 15 billion yuan and achieved a net profit of 900 million yuan, a year-on-year increase of – 6%.
The investment banking business is gradually restarted, and the performance can be repaired. Affected by the suspension of business qualification, the company did not complete the IPO project in 2021, and the refinancing and debt commitments were RMB 1.4 billion and RMB 31 billion respectively, with a significant year-on-year decline. Since the second half of 2021, the investment banking business of the company has been gradually restarted. Since 2022, the company has completed two single IPO projects with a scale of 1.1 billion yuan, and another seven IPO projects have entered the substantive stage. It is expected that the investment banking business sector of the company will usher in considerable restorative growth this year.
Investment suggestion: buy – a investment rating. The company has significant advantages in asset management. It is expected to achieve performance repair under the return of AA rating and the restoration of investment bank qualification. Recently, the company announced that it plans to repurchase restricted stock incentives, which will further consolidate its talent advantage. We expect the net profit attributable to the parent company from 2022 to 2024 to be RMB 12.1 billion, RMB 14.1 billion and RMB 17 billion respectively. Give the company a target price of 21.5 yuan, corresponding to 1.4x2022epb
Risk tip: liquidity has been significantly tightened, investment banking business has recovered less than expected, and industry competition has intensified
