\u3000\u3000 Citic Securities Company Limited(600030) (600030)
In 2021, the company achieved an operating revenue of 76.6 billion yuan, a year-on-year increase of 41%; The net profit attributable to the parent company was 23 billion yuan, a year-on-year increase of 54%. The company’s fund investment advisory business has been officially launched, and the allotment of shares has been approved to support the growth of blue ocean businesses such as derivatives and market making. It is expected to grasp the era dividend of the growth of wealth management demand and the supply side reform of the capital market, continue to give full play to the leading advantages, improve the share, maintain high growth and maintain the buy rating.
Under the high base, the performance accelerated and roe improved significantly. 1) In 2021, the company’s businesses developed in a balanced and steady manner. The annual revenue and net profit attributable to the parent company increased by 41% and 54% respectively year-on-year, and the performance accelerated under the high base (the growth rate in 2020 was 26% and 22% respectively). In Q4, the net profit attributable to the parent company in a single quarter was 5.3 billion yuan, a year-on-year increase of 138%. 2) The profitability was significantly improved, with an annualized roe12 0%, a year-on-year increase of 358bp.
Fund investment advisers made a strong start and lit up long-term growth points. 1) In 2021, the average daily turnover of the stock market was 1058.7 billion yuan, a year-on-year increase of 24.8%. The net value of public funds totaled 25 trillion yuan (as of November), an increase of 27.3% over the beginning of the year. It is expected to drive the growth of the company’s brokerage, asset management and other businesses, which is the main driving force for the growth in 2021. 2) On November 1, the fund investment consulting business of the company was officially launched. As of December 29, the contracted assets exceeded 7 billion yuan and the contracted customers were close to 90000. The new track of financial management continued to expand rapidly, which is expected to continue to benefit from the trend of residents’ wealth growth and moving, and drive the growth for a long time.
The approval of share allotment boosted the growth of heavy capital businesses such as derivatives and market making. The company’s application for share allotment was approved. Of the 28 billion yuan of share allotment, 19 billion yuan is planned to invest in capital intermediary business (including margin trading, stock pledge, income swap, equity and commodity derivatives, market making trading, cross-border trading and other businesses). The derivatives business has broad growth space. The pilot market making trading on the science and innovation board is imminent, and the growth is guaranteed by funds.
The leading position of investment banking business is stable and continues to benefit from supply side reform. In 2021, the company’s equity underwriting market share remained above 18%, and its debt underwriting share steadily increased to 13.8%, both ranking first in the industry. The IPO share increased significantly from 9.5% to 15.7%, and the ranking increased from No. 4 to No. 1. The leading brand effect of the company is outstanding, and it is expected to obtain more dividends in the continuous supply side reform of the capital market.
Valuation
The company is expected to consolidate its long-term growth point, maintain high growth, continue to give full play to its leading advantages and further improve its share through fund investment advisory business, derivatives, market making and other heavy capital businesses. The forecast value of net profit attributable to the parent company in 21 / 22 / 23 is RMB 23.0 billion / 28.4 billion / 32.4 billion, maintaining the buy rating.
Risk tips
The impact of the policy on the industry exceeded expectations; The dual impact of market fluctuations on industry performance and valuation.
