自营业务持续承压：24Q1 沪深300 涨幅+3.10%（去年同期+4.63%）；中证全债+2.34%（去年同期+0.98%），公司投资净收益（含公允）Q1单季9.03 亿元，同比-33.4%。主要是由于受市场波动影响，衍生工具投资收益减少。24Q1，公司交易性金融资产、衍生金融资产和衍生金融负债分别同比12.6%、128.1%和169.7%，非方向性用资提升。Core views:
Performance retracted slightly under the 24Q1 high base. 2024Q1 achieved operating income of 3.611 billion yuan, -18.63% year-on-year; net profit to mother was 886 million yuan, or -37.94% year-on-year. The Q1 weighted average ROE was 1.11%, down 0.76 pct from the same period last year. Excluding agent payments, the leverage ratio was 3.22, down 0.01 from the same period last year. The decline in business was mainly due to a decrease in net revenue from handling fees and a decrease in income from holding and disposing of financial instruments.
The investment banking business is relatively stable. According to Wind's release date data, the total equity financing amount of 2024Q1 was 110.7 billion yuan (-69% YoY), and Orient Securities achieved net investment banking fee revenue of 273 million yuan in the first quarter, -1.22%; according to Wind data, the share underwriting amount of 2024Q1 was 1.03 billion yuan, or -41% YoY; and the total underwriting amount of bonds was 86.344 billion yuan, +28.75% YoY.
Proprietary business continued to be under pressure: 24Q1 Shanghai and Shenzhen 300 rose +3.10% (+4.63% in the same period last year); China Securities full debt +2.34% (+0.98% in the same period last year), and the company's net investment income (including fair) Q1 was 903 million yuan in a single quarter, -33.4% year-on-year. Mainly due to market fluctuations, derivative investment returns have declined. In 24Q1, the company's transactional financial assets, derivative financial assets, and derivative financial liabilities increased by 12.6%, 128.1%, and 169.7%, respectively, and non-directional capital use increased.
Pan-wealth management declined due to the policy environment and poor sales: (1) The average daily transaction volume of the entire market in 24Q1 was +1.9%, and the new issue hybrid fund was -33% year-on-year. The company's 24Q1 brokerage revenue was 486 million yuan, or -30.1% year-on-year, mainly due to a decline in futures brokerage revenue; (2) 24Q1 Orient Securities achieved net revenue of 361 million yuan in asset management fees, or -38.5% year-on-year. (3) At the end of the first quarter, the market balance of finance was 1537.9 billion yuan, -4% year-on-year. The company's Q1 net interest income was 299 million yuan, -28.33% year-on-year, mainly due to an increase in interest expenses.
Profit prediction and investment advice: As the internal stability and investability of the capital market increases, the large asset management industry is expected to reverse, and Orient Securities is particularly beneficial. Referring to peers and the company's PB hub in the past five years, a valuation of 1.2xPb in 2024 was given. The reasonable value of the corresponding A share was 11.37 yuan/share. According to the A/H share premium, the corresponding reasonable value of H shares was HK$4.44 per share, all maintaining a “buy” rating. (HKD/CNY=0.93)
Risk warning. Revenue structures have fluctuated greatly, industry competition has intensified, and capital market policies have been adjusted.
