\u3000\u3 Jointo Energy Investment Co.Ltd.Hebei(000600) 030 Citic Securities Company Limited(600030) )
The company’s operating revenue in the first quarter of 2027 was RMB 6.6 billion, with a year-on-year decrease of RMB 1.6 trillion; The net profit attributable to the parent company was 5.229 billion yuan, a year-on-year increase of 1.24%; The basic earnings per share was 0.36 yuan, a year-on-year decrease of 10%; The weighted return on net assets was 2.26%, a year-on-year decrease of 0.55 percentage points. On a month on month basis, the company’s revenue decreased by 18.68% and the net profit attributable to the parent decreased by 4.13%. The scale of the company expanded steadily and the financial leverage ratio decreased. At the end of the first quarter of 2022, the total assets of the company were 1362.1 billion yuan, an increase of 6.53% over the end of 2021, and the net assets attributable to the parent company were 244.3 billion yuan, an increase of 16.80% over the end of 2021. The company’s financial leverage ratio decreased slightly. After excluding customer assets, the leverage ratio was 4.39, a decrease of 0.52 or 10.69% compared with the end of 2021.
In the first quarter, only the performance of investment banking business increased year-on-year, while the performance of proprietary, brokerage and capital intermediary business decreased year-on-year. On the whole, the company’s performance is basically consistent with the previous performance express and in line with our expectations. The company’s operating income fell year-on-year, mainly because the company’s self operated business income fell by 13.5% year-on-year under the condition of sharp market fluctuations in the first quarter, and only the investment banking business income was growing, with an increase of 14.72%. In the case of declining operating revenue, the company’s net profit increased by 1.24% year-on-year, mainly because the credit impairment provision of 2022q1 company was offset back by 409 million yuan, accounting for 2.69% of operating revenue. According to the operating income data of various businesses of the company in the first quarter, the revenue and growth rate of brokerage, asset management, investment banking, self operation and capital intermediary businesses were 3.186 billion yuan / – 9.55%, 2.776 billion yuan / – 0.42%, 1.828 billion yuan / + 14.72%, 3.351 billion yuan / – 13.50% and 1.006 billion yuan / – 5.82% respectively. In addition, the company’s other business revenue in the first quarter was 2.473 billion yuan, which was mainly the sales revenue of bulk commodity trade, a decrease of 15.45% compared with the same period last year.
The performance of self operated, brokerage and capital intermediary businesses decreased year-on-year. The self operated business scale of the company is basically consistent with that at the end of last year, and the investment scale of financial assets is 599512 billion yuan, a decrease of 2.45% compared with that at the end of 2021. Affected by the sharp fluctuation of the market, the income of self operated business decreased year-on-year. It is estimated that the annualized rate of return of self operated business is 2.21%, while the annualized rate of return in the first to fourth quarters of last year is 3.04%, 5.70%, 2.98% and 5.04% respectively. The net income of brokerage service fees decreased by 9.55% year-on-year, and the scale of two financing contracted. In the first quarter, the average daily turnover of market shares was 1.09 trillion yuan, a year-on-year increase of 7.04% and a month on month decrease of 9.72%. The company’s net brokerage fee income was 3.186 billion yuan, with year-on-year / month on month changes of – 9.55% / + 3.33% respectively. The market financing balance in the first quarter showed a downward trend. The financing balance at the end of the first quarter was 1.58 trillion yuan, a decrease of 7.67% over the end of 2021. The company financed 114.1 billion yuan, a decrease of 11.57% month on month. It is estimated that the market share is 7.22%, a slight decrease from 7.54% at the end of 2021.
The growth of IPO and bond underwriting scale of the company drives the growth of investment banking revenue. According to the statistics of wind, the market equity underwriting scale in the first quarter was 352905 billion yuan, a year-on-year increase of 12.39%, of which the IPO underwriting scale was 132680 billion yuan, a year-on-year increase of 64.87%. The total scale of bond underwriting of securities companies was 2.50 trillion yuan, a year-on-year increase of 9.34%. In the first quarter, the company’s net investment banking fee income was 1.828 billion yuan, with a year-on-year / month on month growth rate of + 14.72% / – 27.25% respectively. We believe that the company’s equity IPO and bond underwriting scale increased year-on-year in the first quarter, driving the year-on-year growth of investment banking business. The company’s investment banking business grew steadily. In the first quarter, the underwriting scale of equity / IPO / bonds was 57.964159.17/396738 billion yuan respectively, with a year-on-year growth rate of -0.03% / + 49.64% / + 43.53% respectively, and the market share was 16.42% / 12.00% / 15.84% respectively, ranking second / third / first respectively.
In the future, it is suggested to pay attention to the development of the company’s asset management business. According to the relevant information of the company’s annual report, the company’s asset management business continues to consolidate the leading position of institutional business. On the one hand, expand and strengthen social security, basic pension, enterprise annuity and other pension businesses, and seize new opportunities for the development of bank financial management business; On the other hand, provide diversified wealth management products for high net worth individuals. In the first quarter, the issuance of new equity funds decreased significantly and the net value of equity funds declined. The scale of Huaxia Fund, the company’s holding subsidiary, maintained steady development. According to the statistics of wind, the management scale of public funds of Huaxia Fund at the end of the first quarter was 1004334 billion yuan, a decrease of 3.32% compared with the end of 2021. The net profit of Huaxia Fund in the first quarter was about 495 million yuan, a decrease of 21.13% compared with Q4 in 2021. We are still optimistic about the steady development of the company’s asset management business in the future. Under the trend of wealth management expansion in the future, the company’s asset management business is expected to continue to contribute to the performance increment.
Investment suggestion: all businesses of the company are in a leading position in the market, and the leading position of the company is stable. Under the extreme market environment, the company’s performance in the first quarter remained positive growth, indicating that the company has relatively strong anti risk ability. We believe that the excellent performance of the company’s anti risk ability is mainly due to the leading advantages of the company’s asset management, self operation and wealth management transformation in the transformation and transformation of the industry. With the policy support of building an aircraft carrier class head brokerage, and with the company’s strong capital strength and leading business ability, we continue to be optimistic about the steady growth of the company’s future performance. We maintain the company’s profit forecast and rating. It is estimated that the operating revenue in 2022 / 2023 / 2024 will be 78.632/88.541/97.527 billion yuan, and the net profit attributable to the owners of the parent company will be 26.521303.87/34.225 billion yuan respectively, with the corresponding growth rate of + 14.81% / + 14.58% / + 12.63% respectively. It is estimated that the roe of the company in 2022 / 2023 / 2024 will be 11.43% / 11.25% / 11.12% respectively. Based on the latest share capital of 14.821 billion shares, it is estimated that the BPS of the company in 2022 / 2023 / 2024 will be 17.21/19.26/22.29 yuan / share respectively. Referring to the historical valuation trend of American investment banks and Chinese securities companies, according to the estimated future performance growth of the company, assuming that the medium and long-term roe level of the company is stable at about 11%, we think it is reasonable to give the company 1.3-1.5 times Pb in 2022, and the corresponding reasonable range of stock price is 22.36-25.81 yuan, maintaining the “overweight” rating of the company.
Risk warning: the decline of market trading activity has dragged down the brokerage business; The transformation of wealth management is less than expected; Intensified market fluctuations drag down asset management and proprietary investment business; The reform of capital market is not as expected; Financial supervision has become stricter.
