Event description
The company released its annual report for 2020, achieving a revenue of 54.348 billion yuan,+26.06% year-on-year; Net profit attributable to the parent company was 14.902 billion yuan,+21.86% year on year; Corresponding EPS 1.16 yuan/share; The weighted average ROE was 8.43%, up 0.67 percentage points over the same period last year.
Event comments
The industry's first securities firm with assets of trillions, and all businesses grew in an all-round way. Brokerage, investment banking, asset management and investment increased by 36%, 54%, 40% and 13% respectively, and investment banking and asset management businesses grew faster than the industry; From the perspective of structure, investment business is still the largest contribution to income, accounting for 33%, but the proportion of light asset businesses such as brokerage, investment banking and asset management has increased. The growth rate of business income and net profit was basically the same as that of the industry, and the accrued credit impairment loss was 6.581 billion yuan, up 248% year on year.
Brokerage is on the rise. With the active transactions in the secondary market, the trading volume of CITIC Securities and CITIC (Shandong) stock based transactions was 28.6 trillion yuan, an increase of 85%, and the scale of financial products sold on a commission basis increased by 21% to 944.7 billion yuan. The company realized a net income of 7.705 billion yuan from the agency trading of securities, a year-on-year increase of 36%.
Investment banks maintain the leading position in the industry. The scale of equity underwriting was 313.599 billion yuan, with a year-on-year growth of 12.08%. Its market share was 18.94%, ranking first in the market, and its share continued to increase by 0.78 pct compared with last year. Bond underwriting continued to maintain its leading position in the industry, with an underwriting amount of 1.30 trillion yuan and a market share of 12.93% (total underwriting amount of securities companies), ranking first in the industry, but the market share declined by 0.25 pct.
The asset management business grew significantly. In 2020, the company realized a net income of 8.006 billion yuan from the asset management business of entrusted customers, a year-on-year increase of 40% and a proportion of 15%. Actively promoted the transformation of active management business. Collective assets amounted to RMB260.124 billion, an increase of 101% in size, and collective asset management revenue amounted to RMB1.229 billion, a year-on-year increase of 147%, making it the largest proportion of asset management business, achieving a revenue of RMB2.408 billion, a year-on-year increase of 49%. The management scale of Huaxia Fund's public funds increased by 49% to 804.6 billion yuan, and the net profit increased by 33% to 1.598 billion yuan, promoting the growth of the company's asset management business.
Allotment of shares strengthened capital strength and steadily promoted internationalization. In February, the company issued a plan for public offering of rights issue and proposed to raise 28 billion yuan of capital to supplement capital intermediary business, subsidiaries and information system construction.
The internationalization strategy has been steadily promoted and integrated management has been fully implemented. CITIC International, an international subsidiary, achieved a net profit of 819 million yuan in 2020, with a loss of 95.56 million yuan in the same period last year.
Investment advice
It is estimated that the company's revenue from 2021-2023 will be 66.104 billion yuan, 77.496 billion yuan and 87.97 billion yuan respectively, and the net profit attributable to the parent company will be 20.264 billion yuan, 26.348 billion yuan and 30.194 billion yuan respectively. The EPS will be 1.57 yuan, 2.04 yuan and 2.34 yuan/share respectively. The net assets per share will be 16.01 yuan, 17.76 yuan and 19.48 yuan, and the corresponding PB will be 1.50 times, 1.35 times and 1.23 times respectively. Maintain the "overweight" rating.
Risk
The secondary market declined significantly; The company has major risk events; The capital market reform was less than expected.
