Spark Global Limited reports:
The share price of Oriental Fortune hit a new high on July 21, up 5.3% on the day, and its market value reached 353.4 billion yuan, an increase of nearly 18 billion yuan compared with the previous day. The turnover for the whole day was 12.63 billion yuan.
Several sell-side analysts said that Orient Fortune’s transformation in wealth management continues to deepen. On the one hand, the rapid growth of the sales profit of the Oriental Wealth Fund forms a strong support for the performance. On the other hand, its Oriental Fortune Securities obtained the fund investment license, and Oriental Fortune expanded from earning fund sales fees to earning investment advisory fees.
Oriental wealth shares hit a new record high
On July 21, the non-silver plate showed a good performance, the non-silver (Shenwan) index rose 0.83%, and some stocks rose well, among which Hongta Securities rose by the daily limit, China International Capital Corporation rose 3.05%, Nanjing Securities, CITIC Construction Investment all rose more than 2%.
Among them, Oriental wealth attracts the attention of the market. The company’s shares hit a new high, rising 5.3 percent on the day to close at 34.19 yuan, giving it a market value of 353.4 billion yuan. From the perspective of brokerage stocks, the market value of Oriental Fortune Securities has greatly exceeded the value of CITIC Securities A Stock Market (market value of 307.9 billion yuan).
Oriental Fortune’s shares have been on a tear this year, up more than 30 percent, compared with declines at other brokerages.
As A new A-share brokerage market capitalization of an elder brother, Oriental wealth for institutional investors. According to the fund’s position data in the first half of the year, for example, Hui Tianfu’s public funds hold a total market value of 772 million yuan; HSBC Jinxin Fund’s funds hold a total market value of 547 million yuan; China Europe Fund’s shareholding market value is 541 million yuan; Dacheng Fund 448 million yuan; Yi Fang Da Fund 342 million yuan.
Fund sales on a commission hot drive performance surge
On July 10, Orient Wealth released its first-half earnings forecast, saying it expected net profit attributable to shareholders of the listed company to be 3.5 billion yuan to 4 billion yuan, up 93.53% to 121.18% from the same period last year.
Orient wealth explained that during the reporting period, the company’s fund third-party sales and service business fund transaction volume and the retained size of the commission funds increased significantly compared with the same period last year, and financial e-commerce service business revenue increased significantly compared with the same period last year. During the reporting period, the stock trading volume of the company’s securities business and the scale of margin and short selling business increased significantly compared with the same period last year, and the related income of securities business increased significantly compared with the same period last year.
Guotai Junan Securities non-bank analysts said that combined with the company’s semi-annual report forecast, the non-securities business profit of Oriental Fortune is 1.429 billion to 1.929 billion, a year-on-year growth rate of 114%-188%, the growth rate of non-securities business exceeds the growth rate of securities business.
It is expected that the main reason is that the fund sales market continues to be hot, every day fund sales scale and the scale of the number of holdings continue to improve. With the recent acquisition of a fund investment license by Orient Wealth Securities, it is expected that Orient Wealth’s future income related to wealth management will still maintain a high growth rate, from earning fund sales fees to earning investment advisory fees.
Securities plate net profit surged 82 percent
On July 17, Orient Fortune disclosed the financial statement of its brokerage Orient Fortune Securities for the first half of the year. According to the unaudited aperture, the operating income of Orient Fortune Securities in the first half of the year was 3.114 billion yuan, a substantial increase of 66% over the same period last year. Net profit was 2.071 billion yuan, up 82 percent from a year earlier.
Of this, fees and commissions accounted for 1.878 billion yuan, up 50 percent year on year. Net interest income was 766 million yuan, up 56% year on year. Self-operating business (investment income + fair value change income) was 410 million yuan, compared with 82 million yuan in the same period last year, the realization of double growth.
A number of sell-side analysts said that the Orient wealth securities bullish. Open source securities analysts said that benefited from the increase in stock market activity and the market share of securities business growth, Oriental wealth securities performance achieved rapid growth, in line with expectations. Based on the higher than expected share of the securities market, Kaiyuan Securities analysts raised the net profit forecast of Orient Wealth from 2021 to 2023 to 7.52 billion yuan, 9.53 billion yuan, 12.06 billion yuan (7.27 billion yuan, 9.36 billion yuan, 11.94 billion yuan).
In the opinion of Kaiyuan Securities analysts, Oriental Wealth Securities’ acquisition of fund investment license, development of private placement and asset management product sales, as well as the vigorous development of overseas business will continuously improve the layout of wealth management, bring the second growth curve of performance, which is the rare target on the high-quality track of Internet sales.
In recent years, Orient Wealth has also made efforts to finance and finance business. From January to September in 2020, margin financing and short selling business revenue accounted for 27% of Orient Wealth Securities revenue, an increase of 77% over the same period of last year.
With its customer resources accumulated over the years as an Internet portal, Oriental Wealth Securities has a strong customer acquisition ability. In the board meeting of Oriental wealth on 5th and 12th, when investors asked about the company’s new strategy to increase the market share of securities business, they clearly indicated that Oriental wealth has certain advantages in increasing the customer expansion of margin and short selling.
In June this year, Oriental wealth securities also issued corporate bonds of no more than 12 billion yuan, aiming to expand financing channels of Oriental wealth securities, supplement working capital and promote the steady development of securities business.