Market performance:
In the current period (April 18, 2022-april 22, 2022), the non bank (Shenwan) index was – 4.68%, ranking 18 / 31 in the industry, the brokerage II index was – 5.33%, and the insurance II index was – 3.47%; Shanghai Composite Index – 3.87%, Shenzhen Component Index – 5.12%, gem index – 6.66%.
The top five stocks in terms of rise and fall: Minsheng Holdings Co.Ltd(000416) (+ 18.69%), Nanjing Securities Co.Ltd(601990) (+ 4.04%), Jingwei Textile Machinery Company Limited(000666) (+ 3.37%), Yong’an Futures (+ 2.43%), Hainan Haide Capital Management Co.Ltd(000567) (+ 2.15%);
The top five stocks in terms of rise and fall: Xishui Strong Year Co.Ltd Inner Mongolia(600291) (- 22.49%), Bode Energy Equipment Co.Ltd(300023) (- 22.03%), Easy Visible Supply Chain Management Co.Ltd(600093) (- 21.82%), Caida Securities Co.Ltd(600906) (- 19.31%), Shenzhen Asia Link Technology Development Co.Ltd(002316) (- 16.87%).
Core view
Insurance: on April 21, the general office of the State Council issued the opinions on promoting the development of individual pension. The opinions made overall arrangements for China’s individual pension system from the aspects of overall requirements, participation scope, system model, payment level, tax policy, capital investment and receipt, operation and supervision, focusing on the following four points:
1. Scope of participation: workers who participate in the basic old-age insurance for urban employees or the basic old-age insurance for urban and rural residents in China.
2. System mode: the individual account system is implemented, and the payment is fully borne by the participants, and the full accumulation is implemented.
3. Payment level: the upper limit of participants’ annual payment of personal pension is 12000 yuan.
4. Fund investment and collection: participants can choose to purchase financial products that meet the requirements of bank financial management, savings deposits, commercial endowment insurance, public funds, etc. and meet the preferences of different investors. It can be withdrawn after reaching age, incapacitated or settling abroad.
The implementation of the individual pension policy marks the initial establishment of the “three pillars” system of China’s endowment insurance. At present, the degree of aging in China is deepening. According to the statistics of the National Bureau of statistics, at the end of 2021, China’s population aged 60 and over was 267.36 million, accounting for 18.9%, a year-on-year increase of 0.2pct; The population aged 65 and above is 200.56 million, accounting for 14.2%. Up 0.7pct year-on-year. On the other hand, China’s population aged 0-15 years in 2021 was 263.02 million, a decrease of 5.28 million compared with 2020, accounting for 18.6% of China’s population. The continuous increase of the elderly population and the decline of the number of newborns make it difficult for the first pillar led by the government and the second pillar led by enterprise annuity to fully support China’s pension system. The third pillar led by individuals is an important means to supplement China’s pension insurance system.
On the one hand, personal pension covers a wider range than the first and second pillars. Under the incentive of tax preference, it is expected to attract a large number of qualified individuals to participate, and the configurable funds in the pension fund account will be further abundant. On the other hand, the investment of individual pension fund account funds is not only insurance products, but also bank financial management, savings deposits and public funds. Asset management and allocation need to be carried out according to the needs of investors. There is also a certain threshold for financial institutions and financial products involved in the operation of individual pensions, which need to be determined by relevant financial regulatory departments and released to the society through information platform and financial industry platform. The risk control system is relatively perfect, and the head securities companies, funds, insurance and bank financial management with high investment and financial management level will take the lead in benefiting, which is expected to seize the first opportunity in the personal pension market. The personal pension system is expected to bring long-term and stable capital inflow to institutions, improve the anti cyclical ability of insurance and securities companies, promote institutions to deepen the transformation of wealth management and raise the valuation of companies, which has a great positive effect.
The insurance sector rebounded on Friday, with the insurance sector up 0.83%. In terms of individual stocks, New China Life Insurance Company Ltd(601336) , China Life Insurance Company Limited(601628) , The People’S Insurance Company (Group) Of China Limited(601319) , China Pacific Insurance (Group) Co.Ltd(601601) , Ping An Insurance (Group) Company Of China Ltd(601318) increased by 2.96%, 2.40%, 1.81%, 1.18% and 0.52% respectively. At present, the overall valuation of the insurance sector is at the bottom of history, and after the introduction of the standard reduction policy to ensure further ample liquidity, the relaxation of the real estate policy, the real estate risk is expected to be further resolved, the asset side risk is gradually recovering, and the marginal is expected to be better. At present, the valuation of the sector is low. Driven by the personal pension policy, it is recommended to pay attention to the valuation repair opportunities.
Brokerage: this week, the brokerage sector continued to callback following the market, with a cumulative decline of 5.33% this week. Market activity fell sharply this week, with an average daily turnover of only 797.7 billion yuan, a month on month increase of – 12.06%. In the current environment of continuous market shock, it is difficult for the securities sector to be alone. China stock market news (- 2.471 billion yuan), Citic Securities Company Limited(600030) (- 1.03 billion yuan) and other popular stocks in the early stage were greatly outflow of funds from the north. In addition, the issuance market of public funds was cold again. As of April 22, the number of newly issued funds was 61, and the issuance share was only 537.04. It is expected that the performance of some securities companies with high brokerage business income in the second quarter will continue to be frustrated.
On the other hand, according to the performance of Citic Securities Company Limited(600030) and China stock market news in the first quarter, they still achieved profit growth under the premise of downward market shock and continuous decline in market activity in the first quarter, reflecting the anti cyclical and stability of securities firm reform. The net profit attributable to parent company of Citic Securities Company Limited(600030) q1 increased by 1.24% year-on-year and the revenue decreased by only 7.20%, China stock market news Q1’s attributable net profit and revenue increased by 13.63% and 10.61% year-on-year respectively. The anti cyclical ability of wealth management transformation began to highlight and the performance stability increased. It is suggested to pay long-term attention to the leading securities companies with strong performance certainty and those with successful wealth management transformation, such as Citic Securities Company Limited(600030) , Huatai Securities Co.Ltd(601688) , China stock market news, etc.
In terms of annual report performance in 2021, as of April 22, a total of 37 securities companies have published annual reports or performance letters, and the head securities companies have basically published all their annual reports. The total operating revenue of 37 securities companies was 620547 billion yuan, a year-on-year increase of 23.10%, and the total net profit attributable to the parent company was 192194 billion yuan, a year-on-year increase of 31.67%. Among the 37 securities companies, only 3 have negative growth in net profit attributable to their parent companies, with overall outstanding performance and significantly improved profitability. Taking a closer look at the 32 securities companies that have disclosed the annual report of 2021, the highlights include the following:
1. The profitability has been significantly improved, with a total of nine parent companies with a net profit of more than 10 billion. Among the 32 listed securities companies, the operating income of 8 securities companies exceeded 30 billion yuan, an increase of China Galaxy Securities Co.Ltd(601881) , Shenwan Hongyuan Group Co.Ltd(000166) , Gf Securities Co.Ltd(000776) and China International Capital Corporation Limited(601995) .
The net profit attributable to the parent company of 9 securities companies exceeded 10 billion, an increase of China Merchants Securities Co.Ltd(600999) , China Galaxy Securities Co.Ltd(601881) , China Securities Co.Ltd(601066) and China International Capital Corporation Limited(601995) . The weighted roe of net assets of 31 listed securities companies was 10.29%, with a year-on-year increase of 1.41pct. Among them, the number of securities companies with roe greater than 10% increased by 3 to 11, and the roe of China stock market news exceeded 20%.
2. Most securities companies have achieved high growth, and some small and medium-sized securities companies have outstanding growth ability. Among the 32 securities companies that announced their performance, a total of 24 securities companies reported a growth rate of more than 20% in their parent net profit, with strong overall growth capacity. Among them, some small and medium-sized securities companies have outstanding growth ability Central China Securities Co.Ltd(601375) net profit attributable to the parent company increased by 392.04% year-on-year, with Orient Securities Company Limited(600958) (+ 97.26%), China stock market news (+ 79.00%) and Founder Securities Co.Ltd(601901) (+ 66.19%) among the highest in the industry Citic Securities Company Limited(600030) as the industry leader, it has achieved an operating revenue of 76.5 billion yuan and a net profit attributable to the parent company of 23.1 billion yuan, which is much higher than that of other securities companies. Under this high base, it increased by 40.71% and 55.01% respectively year-on-year, and its leading position is stable.
3. The performance of wealth management has been significantly boosted. The brokerage, investment banking, asset management, credit and proprietary businesses of 31 listed securities companies increased by 20.49%, 7.72%, 29.82%, 11.90% and 14.79% respectively year-on-year. In terms of wealth management business, based on the high market turnover in 2021, the securities trading business of securities dealers increased by more than 20%, and the growth of Zheshang Securities Co.Ltd(601878) , Soochow Securities Co.Ltd(601555) , Orient Securities Company Limited(600958) , Tianfeng Securities Co.Ltd(601162) , Chinalin Securities Co.Ltd(002945) , China International Capital Corporation Limited(601995) increased by more than 30%. In addition, in 2021, the transformation of asset management business of securities companies achieved remarkable results, and the income of asset management business increased significantly. Among them, Guolian Securities Co.Ltd(601456) , China Industrial Securities Co.Ltd(601377) , Zhongtai Securities Co.Ltd(600918) , Zhongtai Securities Co.Ltd(600918) , Gf Securities Co.Ltd(000776) increased by more than 50%, and the growth rates of Orient Securities Company Limited(600958) and Citic Securities Company Limited(600030) and Citic Securities Company Limited(600030) also exceeded 40%. The big asset management dividend has been initially highlighted. Investment banking business brings differentiated competitive opportunities for small and medium-sized securities companies. The income of investment banking business of leading securities companies was basically stable, and Citic Securities Company Limited(600030) and China International Capital Corporation Limited(601995) performed prominently. The income scale of investment banking exceeded 8 billion and 7 billion respectively, with a growth rate of more than 18%. In 2021, the investment banking business income of some small and medium-sized securities companies achieved rapid growth, with Central China Securities Co.Ltd(601375) year-on-year growth of 207.56%, Guolian Securities Co.Ltd(601456) , Chinalin Securities Co.Ltd(002945) , Guoyuan Securities Company Limited(000728) increasing by more than 50%. The comprehensive registration system and the establishment of the Beijing stock exchange have significantly increased the income of investment banking business of small and medium-sized securities companies. The investment banking business of securities companies welcomes the opportunity period. The breakthrough of small and medium-sized securities companies in investment banking business also depends on their project reserves and whether they have differentiated competitive advantages in a certain field. Significant differentiation of proprietary business. There is a 192.32% gap between the gains of securities companies with the highest and the lowest growth rate of investment income. The investment research ability of securities companies is more important during the continuous shock of the market.
On the whole, the high growth of securities companies in 2021 is mainly based on the incremental income brought by high market trading volume. However, under the general trend of continuous compression of traditional channel business, the transformation of asset management business of securities companies and the important new of investment strength are gradually highlighted. They are optimistic about the leading securities companies with undervalued value and the securities companies with wealth management advantages for a long time, such as Citic Securities Company Limited(600030) , Huatai Securities Co.Ltd(601688) , China stock market news, Gf Securities Co.Ltd(000776) , Orient Securities Company Limited(600958) , etc.
Risk tips: major changes in industry rules, increased external market risks, market fluctuations and repeated epidemics
