Event
Qifu Technology reports second-quarter results for 2023. The total net income of 23Q2 is-6.4% compared with the same period last year, and the home net profit is + 12.0% compared with the same period last year. The company announced that 23H1 paid a dividend of US$0.5/ADS. The company announced share buybacks of no more than $150 million over the next 12 months on June 20, 2023, and has spent approximately $28.3 million on buybacks as of August 18.
Comment
Against a low base, the number of new loans issued by 23Q2 increased by 26.4% to 124.225 billion compared with the same period last year, and the loan balance increased by + 22.6% to 184.459 billion.
The average duration decreased by about 1 month year-on-year to about 11 months.
The cost of getting customers fell compared with the same period last year. The cost of obtaining customers for 23Q2 decreased from Rmb131/ to Rmb296/ compared with the same period last year, while Rmb12/ increased compared with 23Q1. Fees and service fees related to newly issued loans and general management fees have all decreased compared with the same period last year.
23Q2 D1 overdue rate is 4.2%, month-on-month increase of 10bp, year-on-year decline of 70bp over 90 days overdue rate of 1.84%, month-on-month decline of 34bp over 30 days recovery rate of 87.2%, month-on-month increase of 1pct, year-on-year increase of 1.5pct.
The guidelines on the minimum amount of new loans issued in 2023 will be raised. 23Q1 guidelines for 2023 loan issuance for the whole year of 4550-495 billion yuan (corresponding to 10-20% growth), 23Q2 updated to 4700-485 billion yuan (corresponding to 14-18% growth). In the long run, the company will continue to increase new loans from platform services, with 23H1 accounting for 57.0%, an increase of 0.9pct over the end of 2022.
Looking forward, macro uncertainty still exists. The company expects that the process of demand repair in consumer finance is still slow, and the growth rate depends more on macroeconomic repair.
Risk
The consumption enthusiasm of residents is lower than expected, and the ability of risk control is weaker than expected.