Event: The company released its 2023 annual report and 2024 first quarter report. The company achieved operating income of 1,230 million yuan in 2023, +15.69% year over year; realized net profit of 880 million yuan, +25.68% year over year.
The weighted average ROE was 16.57%, up 2.35pct year over year. The company achieved revenue of 345 million yuan in Q1 of 2024, +13.16% year-on-year; realized net profit of 233 million yuan, +21.49% year-on-year.
The weighted average ROE was 4.18%, up 0.52 pct year over year.
Net profit due to mother achieved a year-on-year high increase, and the asset management business performed well in the difficult institutional situation. The company achieved net profit of 800 million yuan to mother in 2023, +25.68% year-on-year. The main driving factor for the high increase in profits is the poor performance of the institutional asset management business. The company achieved revenue of 1,112 billion yuan from disposal of non-performing assets, +8.29% year-on-year, accounting for 90.43% of revenue. By sector, 1) The stock balance of energy distressed asset projects is 4.77 billion yuan. The project is running well, and the restructuring agreement can provide long-term stable restructuring benefits.
2) Listed companies have a balance of 627 million yuan in distress asset projects, and several reserve projects are underway. 3) The stock balance of special opportunity projects was 1,866 billion yuan, and performance flexibility was enhanced. 4) Commercial real estate distressed asset projects have a stock balance of 1,096 billion yuan. The asset distribution structure has been optimized to bring stable rent and value-added income.
The layout of the personal loan bad asset management business is perfect. The company uses “big data+AI technology” to carry out personal loan non-performing asset management business. Through acquisitions and capital increases, the subsidiary acquired a total of 51% of the shares of Guangzhou Huilong, an established electronic actuation company, and the amount of fiduciary disposal assets managed by the company each year reached 100 billion yuan. Through its own funds or partnerships, the company has acquired 29 individual non-performing loan projects. The principal amount of the debt is about 10.6 billion yuan, the principal and interest of the debt is about 18.3 billion yuan, and the consideration is 850 million yuan. The company's personal loan business ranks among the top five AMCs in the country and 60 local AMCs in the industry in terms of market share.
The dividend ratio has stabilized at a high level. The company's dividend ratio continues to be high. The company's cash dividends for 2021 and 2022 were 290 million yuan and 570 million yuan respectively, with dividend ratios of 75% and 82% respectively. During the reporting period, the company plans to distribute cash dividends of 570 million yuan, with a dividend ratio of 65%, a slight decrease over the previous year, but it is still at a high level.
Investment and advice: The company's 2024-2026 revenue is expected to be +16.25%, +20.65%, +24.25%, and net profit to mother of 1,078 billion yuan, 1,338 billion yuan, and 1,694 billion yuan, +22.50%, +24.10%, and +26.57% year-on-year. EPS was 0.55, 0.68, 0.87 yuan/share, and PE corresponding to the closing price on June 18, 2024 was 11.26, 9.07, 7.17 times. Maintain a “buy” rating.
Risk warning: Poor personal loan business development falls short of expectations, macroeconomic fluctuations