Performance Overview: CICC achieved revenue/net profit of RMB 229.9/6.156 billion yuan in 2023, yoy -11.87%/-18.97%; weighted average ROE was 6.43%, -2.45pcts year on year. 23Q4 achieved net profit of 1,548 billion yuan, +47.89% month-on-month and -2.33% year-on-year. Company broker/investment banking/asset management/credit/self-employment (excluding other income) accounted for 24.3%/19.8%/6.5%/-7.2%/56.6%, respectively.
The investment banking business was under pressure, and the scale of bond financing expanded rapidly. Net revenue was 3.702 billion yuan, YOY -47.2%. 1) In terms of equity financing, the company's A-share equity financing amount in 2023 was 86.58 billion yuan, of which the IPO size was 32.245 billion yuan, -39%, ranking fourth in the market; as the bookkeeper, the company underwrote the Hong Kong stock IPO of $529 million, or -47.7% over the same period, ranking first in the market. 2) In terms of bond financing, the company's domestic underwriting scale in 2023 was 1159.538 billion yuan (yoy +26.3%), and overseas underwriting scale was 5.189 billion US dollars (yoy +2.2%).
Proprietary investment remained stable, and credit business losses increased. 1) Net income from proprietary investment yoy -0.5% to 10.556 billion yuan. In terms of scale, by the end of 2023, the company's financial assets reached 35.3 billion yuan, +4% year-on-year, accounting for 56% of total assets. 2) Net interest income yoy -30.5% to -1,335 billion yuan, and losses increased. According to the company's disclosure, the main increase in overseas interest rates has led to an increase in financing interest expenses.
The number of wealth management clients achieved double-digit growth, and net income from brokerage and asset management declined. 1) Net revenue from the company's brokerage business yoy -13.4% to 4.53 billion yuan, which is expected to be mainly affected by the decline in market trading activity. Against the backdrop of market shocks, the company still achieved steady growth in the number and scale of customers. By the end of 2023, the total number of the company's wealth management customers reached 6.8038 million, +17% year on year; customer account assets reached 2.88 trillion yuan, +4.3% year over year. 2) Net revenue from asset management business yoy -11.2% to $1,213 billion. As of the end of 2023, the Group's asset management scale was 1.21 trillion yuan, -7% year-on-year, mainly due to the pooled asset management plan yoy -40% to 139.97 billion yuan.
Investment advice: We expect the company's net profit to be 5.83 billion yuan in 24 years, yoy -5.3%. Taking into account the company's outstanding advantages in cross-border business and institutional business, the short-term pressure of the business does not change its long-term competitive advantage, and maintains a “buy” rating.
Risk Alerts: Policy risks, large market fluctuations, and operational and business risks.