Event: the company disclosed its 2021 annual report, with operating income of 3.3 billion yuan (YoY+4%), net profit of 700 million yuan (YoY-8%), ROE 5.26% (YoY-2.05pct.), EPS 0.18 yuan (YoY-14%).
Overall: 1) the performance under the drag of investment is lower than that of the industry, and the net profit of the securities industry in the same period is-8% to 700 million yuan, ROE 5.26%, and the net profit of the securities industry in the same period is + 21%. 3) according to the traditional five major sectors of business, the contribution of investment and asset management income is the highest, reaching 28% respectively, while other brokerage, investment banking and credit business account for 15%, 9% and 6% respectively. Credit, asset management and brokerage business achieved positive growth, year-on-year + 64%, + 34%, + 14%, investment and investment banking respectively-5%,-32%.
With the in-depth development of asset management business and the rapid growth of the scale of public funds: 1) in the field of asset management of securities firms, the company continues to improve its active management capacity and shrink its channel business. by the end of 2021, the total entrusted funds for the company's securities management business was 58.4 billion yuan, a decrease of 13.7 billion yuan compared with 2020. 2) in the field of public offering funds, the scale of Chuangjin Hexin Fund (51% shareholding), a subsidiary of the company, has grown rapidly. By the end of 2021, the total amount of funds entrusted to management by Chuangjin Hexin was 810.7 billion yuan, which was + 43% compared with the same period last year, including 741.6 billion yuan under special account management. + 40% year-on-year. In 2021, Jinhexin achieved a net profit of 150 million yuan, + 60% of the same period last year. In addition, the company shares in Yinhua Fund (26%). In 2021, Yinhua Fund achieved a net profit of 920 million yuan, + 11% compared with the same period last year.
Fixed income business characteristic development, to transaction-driven transformation: 1) fixed income product sales section, the company sold 5878 fixed income products in 2021, + 14% year-on-year, sales of fixed income products worth 261.9 billion yuan,-9% year-on-year. 2) fixed income investment and trading business sector, corporate bond trading volume in 2021 was 3.9339 trillion yuan, + 11% year-on-year, and market-making trading volume was 1.2441 trillion yuan, + 32% year-on-year. In addition, the trading volume of corporate bonds has achieved a breakthrough, opening up the "northbound" business field.
The brokerage business has transformed into wealth management, and the scale of consignment has greatly increased compared with the same period last year: 1) in the investment banking sector, the company completed 2 IPO orders and 3 additional issues in 2021, with a total underwriting amount of 3.1 billion yuan; completed 27 corporate bond projects and 2 corporate bonds, with a total underwriting amount of 12 billion yuan. 2) in the brokerage business sector, the company continues to promote the transformation to wealth management, with 188000 new customers in 2021, + 28% year-on-year, and average daily assets of 214.6 billion yuan, + 18% compared with the same period last year. 3) in the credit business sector, by the end of 2021, the financing scale of the company was 7.3 billion yuan, which was + 29% compared with the same period last year, and the financing balance share was + 12% compared with the same period last year. 4) in the financial products sales section, the sales scale of the company's financial products in 2021 was 9.3 billion yuan, which was + 71% compared with the same period last year, including 4.2 billion yuan in the equity category and + 32% in the same period last year.
Investment advice: buy-An investment rating. The company has distinctive features in the fixed income and asset management business sector. we expect the company's net profit from 2022 to 2024 to be 10, 11 and 1.3 billion yuan respectively. Give the company the target price of 6.8 yuan, corresponding to 1.8x2022E PB.
Risk tips: macroeconomic downturn, substantial tightening of liquidity, and intensified competition in the industry.
