Caitong Securities(SH:601108)2024-05-05 03:30Investment Rating - The report maintains an "Outperform" rating for the company with a target price of 9.35 RMB [2][3]. Core Insights - The company's wealth management transformation has shown significant effectiveness, with a high proportion of revenue derived from financial product distribution. The asset management business is characterized by its active management and advantages in public fund transformation [12]. - In 2023, the company achieved a revenue of 6.52 billion RMB, representing a year-on-year increase of 35.0%, and a net profit attributable to shareholders of 2.25 billion RMB, up 48.4% year-on-year. The earnings per share (EPS) was 0.48 RMB, with a return on equity (ROE) of 6.67% [2][12]. - The fourth quarter of 2023 saw a revenue of 1.56 billion RMB, a 21.9% increase year-on-year, and a net profit of 0.75 billion RMB, up 71.4% year-on-year. However, the first quarter of 2024 reported a revenue of 1.41 billion RMB, down 21.0% year-on-year, and a net profit of 0.46 billion RMB, down 7.7% year-on-year [2][12]. Financial Performance Summary - The brokerage revenue slightly increased in 2023, with total brokerage income reaching 1.20 billion RMB, a 1.3% year-on-year increase, accounting for 18.4% of total revenue. The company’s financial product distribution revenue was 0.192 billion RMB, up 7.7% year-on-year [2][12]. - The asset management business generated 1.55 billion RMB in revenue, a 6.4% increase year-on-year, with total assets under management (AUM) growing by 12.4% year-on-year to 276.5 billion RMB at the end of 2023 [2][12]. - The investment income (including fair value changes) for 2023 was 1.76 billion RMB, reflecting a substantial year-on-year increase of 1056.2% [2][12]. Future Earnings Forecast - The forecast for EPS in 2024-2026 is 0.48 RMB, 0.54 RMB, and 0.60 RMB respectively, with book value per share (BVPS) projected at 7.79 RMB, 8.18 RMB, and 8.63 RMB for the same period [3][12].