Haitong Securities·2024-11-08 12:46Investment Rating - The investment rating for the company is "Outperform the Market" and is maintained [1] Core Views - The company has shown significant improvement in its investment banking and proprietary trading revenues, leading to a substantial increase in overall revenue. The wealth management sector is expected to continue its growth, benefiting from the development of the large asset management industry. The investment banking business is steadily recovering, with a reasonable valuation range set between 20.39 and 21.96 CNY [4][8] Summary by Sections Financial Performance - For the first three quarters of 2024, the company achieved operating revenue of 19.14 billion CNY, a year-on-year increase of 6.2%. The net profit attributable to shareholders was 6.76 billion CNY, up 16.4% year-on-year, with an EPS of 0.80 CNY and an ROE of 5.3%, reflecting a 0.5 percentage point increase year-on-year. In Q3 alone, the operating revenue reached 7.36 billion CNY, marking a 54.1% increase year-on-year and a 7.8% increase quarter-on-quarter. The net profit for Q3 was 2.40 billion CNY, up 88.9% year-on-year but down 14.9% quarter-on-quarter [4] Brokerage and Wealth Management - The brokerage business faced a decline due to market downturns, with brokerage revenue for the first three quarters of 2024 at 3.99 billion CNY, down 10.7% year-on-year. The average daily trading volume in the market decreased by 7.8% year-on-year. However, the company has accelerated its wealth management transformation, with a financial product distribution scale exceeding 220 billion CNY, a 4% increase from the previous year [5] Investment Banking - The investment banking segment saw a revenue increase of 33.1% year-on-year, totaling 530 million CNY for the first three quarters of 2024. The equity underwriting scale decreased by 44.5% year-on-year, while the bond underwriting scale increased by 48.1%. The company ranked 9th in equity underwriting with a total of 10.27 billion CNY, and 13th in bond underwriting with a total of 260.2 billion CNY [6] Asset Management - The asset management revenue declined by 15.7% year-on-year, amounting to 5.08 billion CNY for the first three quarters of 2024. The asset management scale reached 216.1 billion CNY, a 5.6% increase year-on-year. The company ranks third in public fund management scale, with a total of 1.4278 trillion CNY [7] Proprietary Trading - The proprietary trading segment experienced significant growth, with investment income (including fair value changes) reaching 5.94 billion CNY, a year-on-year increase of 112.5%. In Q3, the investment income was 2.28 billion CNY, reflecting an impressive year-on-year increase of 853.4% [7]