INDUSTRIAL SECURITIES·2024-03-28 16:00Investment Rating - The investment rating for Huatai Securities is "Buy" [1][3]. Core Views - Huatai Securities reported strong performance in 2023, achieving operating revenue and net profit attributable to shareholders of 36.578 billion and 12.751 billion yuan, respectively, representing year-on-year increases of 14.2% and 15.4% [3]. - In Q4, the company recorded operating revenue and net profit attributable to shareholders of 9.348 billion and 3.165 billion yuan, with quarter-on-quarter growth of 5.5% and 4.5% [3]. - The company’s return on equity (ROE) increased by 0.63 percentage points to 8.1% [3]. - The report highlights a significant growth in investment income, with net investment income rising by 64.9% year-on-year to 15.578 billion yuan [3]. - The asset management business showed resilience, with net income increasing by 12.9% year-on-year to 4.256 billion yuan, despite a decline in brokerage and investment banking revenues [3]. Summary by Sections Financial Performance - For 2023, Huatai Securities achieved operating revenue of 36.578 billion yuan and net profit of 12.751 billion yuan, with respective year-on-year growth of 14.2% and 15.4% [3]. - The company’s operating revenue for Q4 was 9.348 billion yuan, with a net profit of 3.165 billion yuan, reflecting quarter-on-quarter increases of 5.5% and 4.5% [3]. - The weighted average ROE increased to 8.1%, up by 0.63 percentage points [3]. Revenue Breakdown - The company generated 14.613 billion yuan from fee-based services, down 10.0% year-on-year, while income from capital-based services surged by 36.9% to 16.530 billion yuan [3]. - Brokerage, investment banking, and asset management revenues were 5.959 billion, 3.037 billion, and 4.256 billion yuan, respectively, with declines in brokerage and investment banking but growth in asset management [3]. Future Outlook - The report maintains a positive outlook for Huatai Securities, projecting net profit attributable to shareholders of 13.116 billion and 14.154 billion yuan for 2024 and 2025, respectively, indicating year-on-year growth of 2.9% and 7.9% [3]. - The price-to-book (PB) ratios are projected at 0.80 and 0.78 for 2024 and 2025, respectively, based on the closing price on March 28 [3].