Event description
The company released its three-quarter report in 2023, with operating income of 18.792 billion yuan in the first three quarters of 2023, down 34.41 percent from the same period last year, and 1.511 billion yuan under the net method, down 22.69 percent from the same period last year. The net profit returned to the mother was 559 million yuan, an increase of 18.32% over the same period last year, and the weighted average ROE was 4.60%, an increase of 0.58pct over the previous year.
Event comment
The performance of interest income was outstanding, and Q3 light assets business improved month-on-month. The net income of handling fee and commission, net interest, investment business (fair value change + net investment income-joint venture) and net income of other businesses (mainly risk management business) in the first three quarters of 2023 were 5.82,4.85,1.80 and 187 million yuan respectively, year-on-year changes of-7.16%, + 13.26%,-41.47%,-68.64%. Q3 business was 2.32,1.62,0.15 and 59 million yuan respectively, with month-on-month changes of 19.85%, 6.51%,-114.62% and-26.73%, and light assets business improved month-on-month.
Market fluctuations in the third quarter affected the investment business. In the first three quarters of 2023, the net investment income of the company's investment business, the investment income of joint ventures and the net income of fair value changes reached 1.86,0.56 and 50 million yuan respectively, with a significant net investment income, which decreased by 132 million yuan compared with the middle of the year. Fair value changes reversed losses, an increase of 117 million yuan over the middle of the year.
Accelerate the layout of overseas business. The company carries out overseas business through the new Yongan Financial Holdings and its subsidiaries, and currently has license business such as Hong Kong futures, securities, asset management and Singapore futures. Since 2023, we will accelerate the layout of overseas business, actively build international financial trading service platforms, spot trading platforms and asset management platforms, and expand customers such as QDII, securities firms and hedge funds.
The risk management business is progressing steadily. The company continues to promote risk management business to help financial services entities. 1) basis trade: successfully registered the first batch of standard warehouse receipts for industrial silicon futures, the "offshore gas station" business continues to advance, with 13 varieties of traders factory warehouse operation qualifications. 2) over-the-counter derivatives business: promote the continuous growth of the business scale. 3) Market-making business: in commodity futures, the market-making qualifications of wide-range industrial silicon futures, polyvinyl chloride and polypropylene futures have been added, and financial options have added market-making qualifications such as Huaxia Kechuang 50ETF options and Yifang Dakuang 50ETF options.
Investment suggestion
The company is the leader of the futures industry, committed to creating a "commodity investment bank, a large category of asset allocation experts, industrial and financial resources integrator", is expected to enjoy industry and policy dividends from the futures market quality and expansion. Taking into account the market volatility and insufficient demand for physical trade, we downgrade the income from the brokerage business and risk management business, and the company is expected to achieve a net profit of 794 million yuan, 946 million yuan and 1.073 billion yuan respectively from 2023 to 2025, an increase of 18.14%, 19.04% and 13.43% respectively over the same period last year.
Risk hint
The financial market fluctuated sharply, the business advance was not as expected, and the company had greater risk events.