On the last day at the end of March, the 2021 annual reports of leading brokerages represented by “Three China and One China” have been fully disclosed.
From the overall situation, CITIC Securities (600030.SH) is still the “leader” in performance.
The annual report shows that in 2021, CITIC Securities’ revenue and net profit attributable to the parent company will be 76.524 billion yuan and 23.1 billion yuan respectively, with a year-on-year increase of 40.71% and 55.01% respectively, and become the only company in the “Three China and One China” with a net profit growth of more than 5%. established brokerage.
CICC (601995.SH), known as the “investment banking aristocrat”, is the first to squeeze into the 10 billion net profit club – its 2021 revenue and net profit attributable to the parent are 30.131 billion yuan and 10.778 billion yuan, respectively, year-on-year. An increase of 27.35% and 49.54%.
The hot IPO market in 2021 will undoubtedly bring a feast of investment banking business to the top brokers, but there are also some top brokers that show a downward trend in this part of the income.
At the same time, as wealth management has become a new competition for securities companies, various securities companies have also continued to make efforts in this business and have achieved relatively considerable performance growth.
Ten billion net profit team added four new members
From the perspective of revenue ranking, the top three in 2021 are still CITIC Securities, Haitong Securities (600837.SH) and Guotai Junan (601211.SH), which is consistent with 2020.
The annual report shows that the revenue of these three securities companies in 2021 will be 76.524 billion yuan, 43.205 billion yuan and 42.817 billion yuan respectively, an increase of 40.71%, 13.04% and 21.64% year-on-year respectively.
Among the top 10 brokers by revenue, except for CITIC Securities, which topped the list with a revenue of 76.524 billion yuan, a total of 7 of the listed brokerages have a revenue of more than 30 billion yuan.
Huatai Securities (601688.SH) and China Galaxy (601881.SH), which ranked fourth and fifth in terms of revenue in 2021, have revenue of 37.905 billion yuan and 35.984 billion yuan respectively, an increase of 21.09% and 51.52% year-on-year respectively.
CICC and CITIC Construction Investment (601066.SH) ranked eighth and ninth respectively in terms of revenue, while CITIC Construction Investment’s revenue scale did not squeeze into 30 billion. The revenue of the two brokerages in 2021 will be 30.131 billion yuan and 29.872 billion yuan respectively, a year-on-year increase of 27.35% and 27.93% respectively.
The performance ranking of China Merchants Securities (600999.SH), which currently ranks tenth, has dropped by 2 places compared with 2020. Its revenue in 2021 will be 29.429 billion yuan, a year-on-year increase of 21.22%.
In fact, the overall ranking of brokerage revenue in 2021 has not changed much, and each company has maintained a certain growth.
However, among the top 10 brokers in terms of net profit attributable to their parents, the growth of most players is not outstanding, and some leading brokerages even have single-digit growth rates.
For example, although the net profits of CITIC Construction Investment and GF Securities (000776.SZ) both reached 10 billion yuan, 10.239 billion yuan and 10.854 billion yuan respectively, the year-on-year growth rates were only 7.67% and 8.13% respectively.
Three institutions, CITIC Securities, CICC and China Galaxy, are exceptions. Wind data shows that among the top 10 securities firms in terms of net profit attributable to their parent, the three securities firms, CITIC Securities, CICC, and China Galaxy, have net profit attributable to their parent of 23.1 billion yuan, 10.778 billion yuan, and 10.43 billion yuan, respectively, with a year-on-year growth rate of 55.01%, 49.54% and 43.99%.
However, under the growth of overall performance, more leading brokerages are entering the group of “earning tens of billions a year”. Tradewind (ID: TradeWind01) noted that in 2020, only 5 securities firms will have a net profit attributable to the parent company exceeding 10 billion yuan, and there are as many as 9 leading brokerage firms that will reach this level of profit in 2021.
Among them, CICC, China Galaxy (601881.SH), China Securities Investment and China Merchants Securities (600999.SH) are all new faces of the “ten billion club”.
“Three middle schools” dominate the IPO list
The popularity of the A-share IPO market in 2021 will also bring more growth to the top brokerage business. The “Three China and One China” has also maintained its advantages in this field.
In terms of net fee income from investment banking business, CITIC Securities still topped the list with 8.156 billion yuan, an increase of 18.51% year-on-year; CICC and Huatai Securities were 7.036 billion yuan and 4.344 billion yuan respectively, both of which increased year-on-year respectively. 18.14%, 19.22%.
In terms of winning big IPO orders, the advantages of these three “Chinese prefix” brokerages are even more obvious.
Among the top ten IPOs in the world in 2021, three A-share listed companies will be listed.
Among them, the second-ranked China Telecom (601728.SH) raised funds as high as 47.904 billion yuan, and the project was jointly sponsored by CICC and China Securities Construction Investment; Three Gorges Energy (600905.SH) raised funds with 22.713 billion yuan. Ranked 7th in the world for IPOs, its sponsor is CITIC Securities; the ninth is BeiGene (688235.SH), which raised 22.160 billion yuan, and the sponsors responsible for the project are CICC and Goldman Sachs Gao Hua.
According to statistics from TradeWind (ID: TradeWind01), among nearly 200 projects whose review was terminated due to various reasons such as withdrawal in 2021, the number of leading institutions has gradually increased – CITIC Securities, Huatai United, Minsheng Securities, The number of terminated projects of CITIC Construction Investment, Guotai Junan and China Merchants Securities all exceeded 10, of which CITIC Securities had the largest number of terminated projects, reaching as many as 19.
“Top brokerages are more familiar with the rules, so many projects are voluntarily abandoned during the review process, and this data situation occurs.” An investment banker from a top brokerage pointed out.
Although some leading brokerages are not as good as “Three China and One China” in winning large IPO orders, they have also performed well.
For example, the net fee income from investment banking business of Guotai Junan and China Merchants Securities was 4.062 billion yuan and 2.542 billion yuan respectively, an increase of 8.76% and 18.46% year-on-year respectively.
It is worth noting that the net fee income from investment banking business of some leading brokerages has shown a downward trend.
For example, the net investment banking fee income of CITIC Construction Investment and Haitong Securities was 5.631 billion yuan and 4.925 billion yuan respectively, down 3.85% and 0.27% year-on-year respectively. Under the impact of the sequelae of “Kangmei Pharmaceutical”, GF Securities’ net income from investment banking fees was only 433 million yuan, a decline of 33.28%.
Wealth management impacts the volume of “tens of millions of households”
According to statistics from the China Merchants Bank Private Wealth Report, as of the end of 2021, the total size of investable assets held by individuals in China was regarding 268 trillion yuan, an increase of 11.20% from the end of 2020; high net worth individuals with investable assets exceeding 10 million yuan The number of people is regarding 2.96 million, an increase of 12.98% over the end of 2020.
Under this market demand, various securities companies have also made efforts in the wealth management business. Judging from the published data, more and more securities companies’ wealth management customers are constantly breaking through the tens of millions.
By the end of 2021, the number of CITIC Securities customers has exceeded 12 million, and the total assets of clients under custody totaled 11 trillion yuan, an increase of 29% from the end of 2020.
CITIC Securities revealed: “In 2021, the company’s wealth management revenue will account for 30% of the wealth management sector revenue.”
The number of wealth management clients of Haitong Securities has also exceeded 10 million.
As of the end of 2021, the number of wealth management clients of Haitong Securities (excluding dormant accounts) was 14.268 million, an increase of 8.50% over the beginning of the reporting period, and the total client assets at the end of the period were 2.82 trillion yuan (tradable), an increase of 16.40% over the beginning of the period.
Some leading institutions are accelerating the adjustment of wealth management business lines.
For example, CICC will integrate 20 domestic business offices engaged in wealth management business into CICC Wealth in 2021, further realizing the business integration of both parties.
As of the end of 2021, the number of CICC wealth management customers reached 4.5351 million, a year-on-year increase of 22.9%. Although the number of its customers is not as high as that of Haitong Securities, its high per capita assets still make its wealth management account assets as high as 3.00 trillion yuan, an increase of 16.2% over the previous year.Return to Sohu, see more
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