Huachuang Securities·2024-03-29 16:00Investment Rating - The report maintains a "Recommended" rating for Huatai Securities with a target price of 18.1 CNY, compared to the current price of 14.04 CNY [2]. Core Views - Huatai Securities reported a significant increase in revenue and net profit for 2023, with total operating income reaching 36.578 billion CNY (up 14.2% year-on-year) and net profit attributable to shareholders of 12.751 billion CNY (up 15.4% year-on-year) [2][3]. - The company's return on equity (ROE) was 7.4%, reflecting a slight increase of 0.4 percentage points year-on-year [2]. - The report highlights a strong performance in proprietary trading, which contributed significantly to the overall revenue growth, while other segments like brokerage and investment banking faced challenges [2]. Summary by Sections Financial Performance - Total operating income for 2023 was 36.578 billion CNY, with a year-on-year growth of 14.2% [3]. - Net profit attributable to shareholders was 12.751 billion CNY, representing a 15.4% increase year-on-year [3]. - The company's net assets attributable to shareholders increased to 179.108 billion CNY, up 8.5% from the beginning of the year [2]. Business Segments - Proprietary trading revenue surged by 93.6% year-on-year, contributing 116.7 billion CNY to total revenue [2]. - Asset management fees reached 4.256 billion CNY, growing by 12.9% year-on-year, while brokerage fees fell by 15.8% to 5.959 billion CNY due to a decline in market trading volume [2]. - Investment banking revenue decreased by 24.5% to 3.037 billion CNY, impacted by a reduction in IPO and refinancing activities [2]. Market Position - The company's market share in margin financing increased to 6.80%, up 0.3 percentage points year-on-year, with a margin financing balance of 112.34 billion CNY, growing by 11.6% [2]. - The report indicates that the asset management business remains robust, despite a slight decline in overall asset management scale [2]. Future Outlook - The report anticipates a recovery in market conditions, which could enhance the company's ROE and allow for balance sheet expansion [2]. - Earnings per share (EPS) forecasts for 2024, 2025, and 2026 are projected at 1.48 CNY, 1.70 CNY, and 2.08 CNY respectively, with corresponding price-to-book (PB) ratios of 0.78, 0.73, and 0.68 [2][3].