Main points of investment: the only legal person securities company in Henan Province, AqiH has greatly improved its listing and financing capacity in both places, reformed all aspects of each line, and adhered to a high dividend rate. The reasonable value range is 4.73-5.32 yuan, maintaining the "neutral" rating.
[event] Zhongyuan Securities achieved revenue of 2.336 billion yuan in the first half of 2021, + 86.9% year-on-year; net profit of 229 million yuan, + 642.2%; and EPS, corresponding to ROE 1.7%. The reason for the sharp increase in net profit is mainly due to the excellent performance of the investment banking business, the poor performance of investment income in the same period last year, the low profit base and so on. In the first half of 2021, brokers, investment banks, asset management, interest and self-management accounted for 16%, 11%, 1%, 3% and 18% of operating income, respectively.
Deep ploughing the local market, multi-channel coordinated development. The company's brokerage business income in the first half of 2021 was 385 million yuan, + 11.9% compared with the same period last year. The trading volume of the stock base reached 854.8 billion yuan, + 1.13% compared with the same period last year, with a market share of about 0.37%. There was active trading in the whole market in the first half of 2021, with an average daily stock base trading volume of 966.2 billion yuan, + 21.4% compared with the same period last year, with a balance of 1.7842 trillion yuan, + 10.2% compared with the beginning of the year. The net income from the consignment of financial products reached 38 million yuan, + 109% of the same period last year. The average daily holdings of non-monetary public funds is + 198.9% compared with the same period last year. The company's brokerage business deeply ploughs the Henan market, focuses on customer operation, actively grasps the new opportunities for deepening the development of the capital market, and promotes the integrated layout of online and offline.
Continue to expand non-provincial markets and reserve high-quality project resources. In the first half of 2021, the company realized 267 million yuan in investment banking business, + 169.7% compared with the same period last year. 2) the underwriting scale of equity business is-14% compared with the same period last year, and that of bond business is-64% compared with the same period last year. The main underwriting scale of equity is 6 billion yuan, ranking 24th; among them, 6 are IPO, raising 3.9 billion yuan; and 3 are refinancing, with an underwriting scale of 2.1 billion yuan. The main underwriting scale of bonds was 3.2 billion yuan, ranking 75th; the underwriting scale of corporate bonds and corporate bonds reached 2.6 billion yuan and 600 million yuan respectively. There are 26 IPO reserve projects, ranking 30th, including 2 on the main board and 11 on the gem.
Actively respond to the new regulations on asset management, steadily improve the level of investment in research, and increase investment in standardized product design. In the first half of 2021, the asset management income was 17 million yuan,-13.8% compared with the same period last year. By the end of June 2021, the total size of the company's asset management business was 5.8 billion yuan, up from-7.9% at the end of 2020. The company's asset management business conscientiously implemented the requirements of the new regulations on asset management, accelerated the rectification and reform of existing private asset management products and the public offering transformation of large collection products, enhanced the ability of active management, and safely started the work of standardized new product issuance.
The investment strategy will be adjusted in time to reduce the impact of the epidemic and market fluctuations, and the income will be improved again. In the first half of 2021, the net income on investment (including fair value) was 421 million yuan, which was + 60.2% compared with the same period last year. In terms of equity investment, the company has achieved better investment returns by participating in private placement, applying for asset management products and independently investing in all kinds of equity products. In terms of fixed income investment, we carry out market-neutral investment business through hedging, and actively participate in the bill business of the Shanghai Securities Exchange to obtain stable excess returns on the premise of low risk.
[investment suggestion] We expect the company's net profit per share for 2021-2023E to be 0.09,0.10,0.11 yuan respectively, and its net assets per share to be 2.96,3.00,3.04 yuan respectively. Taking into account the effectiveness of the company's digital transformation, investment banking business continues to expand outside the province, a number of businesses have growth potential. In addition, the company listed on the stock market, completed 3.6 billion yuan of A-share non-public offering financing in July 2020, and is expected to accelerate the growth of capital consumption business. We give it slightly higher than the industry average valuation and give it 1.6-1.8x Pmax B in 2021, corresponding to a reasonable value range of 4.73-5.32 yuan, maintaining a "neutral" rating.
Risk hint: the continued downturn in the market has led to a decline in the scale of business, and market supervision has been further strengthened.
