occurrences
The company released the “2023 Annual Report” after closing on March 14, 2024.
Comment:
Revenue and profit have declined, and the revenue of the securities self-operated fixed income business increased sharply over the same period in 2023. The company has always insisted on putting user needs at the center, withstanding external pressure, maintaining strategic strength, focusing on strengthening internal operation management, improving the quality and efficiency of various tasks, and striving to achieve the sustainable and healthy development of various businesses. Affected by factors such as capital market sentiment, the company achieved total operating income of 11.081 billion yuan, a year-on-year decrease of 11.25%; realized net profit to mother of 8.193 billion yuan, a year-on-year decrease of 3.71%. Among them, securities services achieved revenue of 7.194 billion yuan, a year-on-year decrease of 8.44%; financial e-commerce services achieved revenue of 3.625 billion yuan, a year-on-year decrease of 16.19%; financial data services achieved revenue of 198 million yuan, a year-on-year decrease of 13.13%; and Internet advertising services achieved revenue of 64 million yuan, a year-on-year decrease of 14.42%. Benefiting from a sharp year-on-year increase in revenue from the securities self-operated fixed income business, the company achieved investment income and fair value change income (not included in total operating income) of 2,236 billion yuan, an increase of 100.31% over the previous year. The annual share base transaction volume of Dongfangwealth Securities was 19.27 trillion yuan, further increasing the brokerage market share. As of the end of 2023, Tiantian Fund's cumulative fund sales exceeded 10 trillion yuan.
Continuing to consolidate R&D technology advantages and actively explore the application of big models in various financial scenarios In 2023, the company integrated and strengthened R&D capabilities, focused on strengthening AI capacity building, and actively explored the application of big models in various financial scenarios, further consolidating the company's R&D technical advantages. In January 2024, the “Wonderful” financial model independently developed by the company officially began closed testing. With data characteristics and algorithm advantages, the “Miaoxiang” financial model focuses on continuous optimization of financial vertical capabilities in core financial scenarios, and is being integrated into the company's product ecosystem in an orderly manner. During the reporting period, Miaoxiang Big Model was awarded “Best Practice Case” in the Big Model Case Selection organized by the Chinese Academy of Information and Communications Technology, became the first batch and only financial industry partner in the “Fangsheng” Big Model Evaluation System of the Chinese Academy of Information and Communications Technology, and also received honors such as “Finance+AI Excellent Case” issued by the China Artificial Intelligence Industry Development Alliance.
Implement a share repurchase plan to cancel and reduce the company's registered capital, demonstrating confidence in long-term development. In August 2023, based on confidence in the company's future development prospects and recognition of the company's long-term value, in order to protect the interests of the majority of shareholders and enhance investor confidence, the company introduced a share repurchase plan. It plans to use 500 million yuan to 1 billion yuan of its own capital to repurchase the company's shares. As of February 26, 2024, the company has completed share repurchases, with a cumulative repurchase amount of nearly 1 billion yuan. At the same time, in order to further boost investor confidence, implement the “investor-based” development concept of listed companies, and repay investors, the board of directors held a meeting to adjust all share repurchases to be used to cancel and reduce the company's registered capital.
Profit forecasting and investment advice
The company is a scarce domestic Internet service platform. Along with the healthy development of China's capital market, there is plenty of room for continued growth in the future. The company's revenue for 2024-2026 is estimated to be 118.16, 125.45, 13.252 billion yuan, net profit to mother of 88.52, 95.08, 10.158 billion yuan, and EPS of 0.56, 0.60, 0.64 yuan/share, corresponding PE of 24.56, 22.86, 21.40 times. Maintaining a “buy” rating considering the industry's room for growth and the continued growth of the company's business.
Risk warning
The risk that the industry and business are affected by fluctuations in capital market sentiment; the risk of safe operation of Internet information transmission and trading systems; the risk of further intensification of industry competition; macroeconomic and industry policy risks; and legal compliance risks.