Benefiting from the upward index, the heavy capital business is relatively sound: 1) the market index rose, and the proprietary business performed well. In the first quarter of 2023, the Shanghai Composite Index / gem Index / CSI 300 rose or decreased by + 5.94% / 2.25% / 4.63% respectively, promoting a substantial increase in the company's investment income and fair value change income. Proprietary business income was + 177% to 1.5 billion yuan (accounting for 23% of revenue) compared with the same period last year. 2) the market size shrinks and the company's business market share decreases, which affects the capital intermediary business to decline slightly. By the end of March 2023, the market balance was-3.95 to 1.61 trillion yuan compared with the same period last year; the company raised funds from-15 to 82.8 billion yuan year-on-year, and the market share dropped by 0.66pct to 5.15%; industry factors superimposed the decline in the company's business market share, affecting the company's net interest income from-5% to 900 million yuan year-on-year (14% of revenue).

Pan-wealth management business revenue decline: 1) the expected business size shrinks, affecting the decline in asset management business income: 2023Q1 fund market overall redemption sentiment is strong, new fund share year-on-year-41 to 38.7 billion, company asset management and fund management business income-11% to 2.1 billion yuan (accounting for 32% of revenue), we expect asset management business revenue to decline It is mainly due to the reduction of the size of the company's net asset management (the total size of the company's net asset management in 2022-45 to 271.2 billion yuan). 2) the shrinking market trading volume has affected the decline of brokerage business revenue: the average daily stock base turnover in the 2023Q1 market is-9% to 989.5 billion yuan compared with the same period last year, the market trading activity is still poor, and the company's brokerage business income is-13% to 1.4 billion yuan (accounting for 22% of revenue). 3) the investment banking business is under short-term pressure and the risk is expected to be controllable:

According to the Wind,2023Q1 market IPO/ refinancing / debt scale year-on-year-64% Wind,2023Q1 72% Universe 5% to 651Universe 2,561.9 billion yuan, the total underwriting scale of IPO has declined significantly; 2023Q1's total underwriting volume is-4% to 43.2 billion yuan year-on-year, and the company's investment banking revenue is-33% to 101 million yuan (accounting for 2% of revenue). Due to the historical problems of the company's investment banking, the performance of the investment banking business is relatively under pressure, but the company still has IPO projects on the ground recently (the company helped North Changlong to achieve gem IPO in 2023-4-18), and we expect the overall risk of the company's investment banking business to be controllable.

The development of public offering leader is steady, and the space for wealth management is broad: the continuous growth of residents' wealth and diversified needs provide a broad space for the company's wealth management business. The company continues to consolidate core competencies such as active management and channel marketing, constantly improve the operation mechanism, and further consolidate the core business characteristics and differentiated competitive advantages of "wealth management + asset management". And the company participates in the leader of the public offering industry, and its stable performance is that the company continues to contribute profits: as of March 2023, the asset size of Yi Fangda and Guangfa Fund is 11.72% to 1.71 trillion yuan respectively compared with the same period last year (accounting for 11.27% of the total size of public offering funds), ranking first / second in the industry.

Profit forecast and investment rating: the company's overall performance growth rate recovers, proprietary business picks up, brokerage business grows obviously, and the company's two major public offering funds have a stable position, so we basically maintain the company's performance expectation. It is estimated that the company's homing net profit in 2023-2025 will be 99max / 13.1 billion yuan, and the current market capitalization corresponds to 1.010.95amp 0.88 times PB in 2023-2025, maintaining the "buy" rating.

Risk hint: the securities market is systematic, the industry competition is intensified, and the recovery of securities business is not as expected.