This report is read as follows:
The company's 18Q1 trust business income reached a single-quarter high, the company has outstanding advantages in active management and net capital scale, and continues to be optimistic about the annual performance growth trend; at present, the stock price corresponds to 13 times 18P/E, and the valuation is extremely safe.
Main points of investment:
Maintain the target price of 16.8 yuan, corresponding to 18P/E 19X, increase holdings. The company's 18Q1 operating income / return net profit 1.59 billion yuan, year-on-year-2.7% Universe 3.5%, in line with our expectations. The revenue from the company's trust business grew slightly more than expected in the first quarter, + 21% compared with the same period last year, and the inherent investment business has a certain drag on the performance, which is expected to be gradually improved; the company has outstanding advantages in active management and net capital scale, and the new rules of asset management are expected to have a limited impact on the company's performance; maintain the company's EPS0.89/0.96/1.07 for 2018-20 years; the current stock price corresponds to 13 times 18P/E, and the valuation is extremely safe.
The income of trust business reached a single-quarter high, and the expansion of inherent loan business reflects the advantage of capital side. 1) the company's 18Q1 trust business fee net income is 1.92 billion yuan, + 21.2% year-on-year and + 17.7% month-on-month, setting a record high for a single quarter. The scale of trust management is expected to grow steadily during the reporting period, and the company continues to be optimistic about the growth trend of the company's annual trust business income. 2) the company's inherent loan financing business shows a trend of expansion. The loan size issued by 18Q1 at the end of the year reached 7.09 billion yuan, an increase of 28% over the beginning of the year. The net interest income of 18Q1 was 68 million yuan, and + 128% compared with the same period last year. The company has abundant net capital and relies on the expansion of inherent loans to enhance its competitive advantage under the background of tight capital brought about by supervision. 3) the company's inherent investment business income (investment income + fair value change) in the first quarter is-380 million yuan, which is a certain drag on the performance.
The de-channel of the trust industry has little impact on the company, and the issuance of preferred shares strengthens the net capital advantage. 1) the company's active management ability is outstanding, accounting for 68% of the active management scale at the end of 17, and the impact of industry access on the company's performance is very limited. 2) the company announced in September 17 that it intends to issue no more than 6.8 billion yuan of preferred shares to supplement net capital, and the issuance of preferred shares will further strengthen the company's net capital advantage and contribute to the sustained growth of performance.
Catalyst: the scale of active management trust continues to grow; preferred stock issuance is promoted.
Risk factors: regulatory policies have an uncertain impact on the scale of trust actively managed by companies.
