Overview of the 2023 Interim Report: In the first half of 2023, CaiTong Securities achieved operating income of 3.475 billion yuan, +56.15% year-on-year; realized net profit of 1,037 billion yuan, or +63.89% year-on-year. Basic earnings per share were 0.22 yuan, +46.67% year on year; weighted average return on net assets was 3.09%, +0.80 percentage points year on year. There will be no distribution or increase for the semi-annual period of 2023.
Comment: 1.2023H The share of the company's investment income (including changes in fair value) and other income increased, while the share of net income from brokerage, investment banking, asset management, and interest declined. 2. The asset size of institutional clients continued to grow, and net income from brokerage fees was -4.15% year-on-year. 3. The scale of equity and bond financing has increased markedly, with net income from investment banking fees +72.43% year-on-year. 4. The scale of brokerage asset management business continued to grow, and net income from asset management fees was +4.79% year-on-year. 5. Equity, fixed income, and self-employment all achieved good investment returns. Investment income (including changes in fair value) was +336.52% over the same period. 6. The scale of the two loans has steadily rebounded, the size of pledges has increased, and net interest income was -31.18% year-on-year.
Investment suggestions: The number of clients of corporate brokerage institutions continued to grow during the reporting period, the total volume of investment banking business increased markedly, the scale of brokerage asset management business increased steadily, and both equity and fixed income self-management achieved good returns. The company has a remarkable location advantage and is of high quality among small to medium brokerage firms. It is estimated that the company's EPS in 2023 and 2024 will be 0.45 yuan and 0.49 yuan respectively, and BVPS will be 7.27 yuan and 7.50 yuan respectively. Based on the closing price of 8.28 yuan on August 25, the corresponding P/B will be 1.14 times and 1.10 times, respectively, maintaining the “increase in holdings” investment rating.
Risk warning: 1. The weakening of the equity and fixed income market environment led to a decline in the company's performance; 2. Risk of market fluctuations; 3. The progress and intensity of comprehensive deepening of capital market reforms fell short of expectations