\u3000\u3000 Citic Securities Company Limited(600030) (600030)
Event: the company released the performance express of 2021, realizing an operating revenue of 76.6 billion yuan (YoY + 40.8%), a net profit attributable to the parent company of 23 billion yuan (YoY + 54.2%), and a weighted average roe12.5% 01%（YoY+3.58pct.）， EPS1. 77 yuan (YoY + 52.59%).
The company realized a year-on-year net profit attributable to the parent company of + 54% to 23 billion yuan, exceeding market expectations. 1) The company’s net profit exceeded a record high in 2015 (19.8 billion), and the performance growth rate was the highest since 2016. 2) The weighted average roe of the company reached 12.01%, the highest level since 2016, an increase of 3.58pct compared with 8.43% in 2020. 3) The company achieved a net profit of 5.334 billion yuan in 2021q4, a year-on-year increase of + 138%, mainly due to the low base caused by the provision of 1.553 billion yuan of credit impairment in 2020q4, driving the company’s annual performance growth rate to further improve on the basis of + 39% in the third quarter.
Investment banking, asset management and other businesses developed in a balanced manner and grew steadily. 1) In the previous three quarters, the investment, brokerage and asset management businesses made the highest contribution, reaching 27%, 19% and 15% respectively. The growth rate of credit and asset management businesses was the highest, reaching + 139% and + 59% respectively. 2) The asset management sector performed well, mainly benefiting from the positive management transformation of asset management of securities companies, the continuous growth of scale and the improvement of public offering performance contribution. By the end of September 2021, the average monthly scale of assets under active management of the company’s private placement had reached 852.8 billion yuan, ranking first in the industry, up + 28.3% from the beginning of the year. In the first three quarters, Huaxia Fund realized a net profit of 1.69 billion yuan, a year-on-year increase of + 46%. 3) The scale of investment banking business has increased rapidly, leading the industry. According to wind data, the company completed an IPO scale of 85 billion yuan in the whole year, a year-on-year increase of + 90%, with a market share of 15.7%, an increase of 6.4pct compared with 2020, ranking first in the industry (ranking fourth in the industry in 2020).
The placement of shares is imminent, and the capital strength is further improved. On November 26, the company’s share allotment application was approved by the CSRC, which approved the company to allot 1.939 billion shares (1.597 billion A-Shares and 342 million H shares) to the original shareholders, raising no more than 28 billion yuan, including 19 billion to develop capital intermediary business, 5 billion to invest in subsidiaries, 3 billion to strengthen information system construction and 1 billion to supplement working capital. As the leader of institutional business, the fund-raising of the company is mainly invested in the capital intermediary business. It is optimistic that the company will enhance its capital strength, optimize its business structure and drive the steady and good growth of performance after completing the allotment in 2022.
Investment suggestion: buy – a investment rating, 6-month target price of 31 yuan. The company’s comprehensive strength leads the industry. Considering that the institutional business is a deterministic growth business derived from wealth management, the company, as the leader of institutional business, is optimistic that the company will open up business development space after completing the allotment of shares and further drive performance growth. We raised the company’s profit forecast and predicted that the growth rate of net profit attributable to the parent company from 2021 to 2023 will be 54%, 32% and 25% respectively.
Risk warning: large market fluctuation / derivatives market making hedging risk / policy change risk
