Securities firms are holding performance briefings intensively! Leading securities firms respond to the merger wave

With the conclusion of the third quarter report disclosures, listed companies are holding performance briefings in quick succession.

So far, CITIC Securities, Huatai Securities, CMS, Everbright Securities, Soochow Securities, and Caida Securities have held their third quarter performance briefings for 2024.

Reporters from Securities Times noticed that many investors raised financial-related questions regarding the third quarter reports, and most securities firms responded promptly.

It is worth mentioning that regarding the topic of mergers and acquisitions in the securities industry, two leading securities firms also provided responses. A senior executive from CMS stated that mergers and acquisitions are an important means to achieve growth and strength. Through mergers and acquisitions, capital expansion and client resource integration can be realized, accelerating the ability to enhance service construction towards the goal of building a strong financial nation, and the firm will continue to track and study related opportunities in industry mergers and acquisitions.

Addressing Sensitive Financial Report Issues

At the performance briefing of Soochow Securities, an investor asked about the decline in investment banking revenue this year compared to last year, inquiring about the current state of investment banking operations and any future countermeasures.

Soochow Securities Chairman Fan Li stated that the company's investment banking business has seen a certain degree of decline due to the phased slowdown in the pace of equity financing in the capital market. Since the beginning of this year, the company has completed six projects, including IPOs, refinancing, and mergers and acquisitions, among which are the first major asset restructuring project approved by the Shenzhen Stock Exchange this year and the first overseas major asset restructuring project approved by the Beijing Stock Exchange; four new projects have been submitted to the Beijing Stock Exchange, ranking second in the industry.

Looking ahead, Fan Li stated that the company will resolutely implement regulatory requirements in its investment banking business, strictly fulfill professional oversight and continuous supervision responsibilities, prioritize quality, continuously strengthen the reserve of high-quality IPO and refinancing projects, fully leverage the advantages of the Beijing Stock Exchange's long board business, actively develop mergers and acquisitions, improve the quality of listed companies, and contribute to the cultivation and development of new productive forces.

At the performance briefing of Everbright Securities, an investor mentioned that although Everbright Securities' operating income in the third quarter of 2024 increased by 41.06% year-on-year, the net profit attributable to the parent company decreased by 69.49% year-on-year. What is the main reason for this significant contrast?

In response, Everbright Securities Vice President and Board Secretary Zhu Qin stated that the previous year's subsidiary, Everbright Capital, signed an execution settlement agreement, reversing estimated liabilities and forming non-recurring gains and losses of 2.15 billion yuan, accounting for 49% of the net profit attributable to the parent company in the same period last year. The company's net profit attributable to the parent company, excluding non-recurring gains and losses, increased year-on-year.

For Huatai Securities, investors asked during the performance briefing whether the sale of AssetMark in the third quarter of this year indicates a certain adjustment in the company's overseas expansion strategy.

Huatai Securities Chief Financial Officer Jiao Xiaoning stated that Huatai Securities will continue to firmly promote its internationalization strategy, continuously enhance its integration into global mainstream markets in breadth and depth, and deepen cross-border integrated linkage, laying a solid foundation for building a first-class investment bank with both local advantages and global influence. In addition to relying on the Hong Kong market, the company is steadily laying out other overseas markets and is committed to using Singapore as a regional center to cover emerging economies in Southeast Asia, providing overseas investors with products and services with Chinese characteristics, continuously improving market competitiveness and industry position At the same time, Huatai Securities will focus on internal and external customer needs, seize market opportunities, and actively expand more development opportunities in emerging and mature markets in key business areas.

During the performance meeting, when asked about the company's third-quarter report for 2024, which shows an investment income of 5.056 billion yuan and management expenses reaching 6.755 billion yuan, what are the top five projects in terms of investment income?

In response, Wu Zongmin, President of CMS, stated that in the first three quarters of 2024, the company continued to implement a "large and stable" investment strategy, strengthened asset allocation, coordinated investment business resource allocation, investment decision-making, and risk management from top to bottom, and adjusted and optimized the investment structure in a timely manner according to changes in market conditions, continuously improving business strategies and effectively enhancing investment income and income stability.

Responding to the Wave of Mergers and Acquisitions in the Securities Industry

Since the beginning of this year, the securities industry has seen a surge in mergers and acquisitions, with cases such as Guotai Junan merging with Haitong Securities, and Western Securities acquiring Guorong Securities, attracting investor attention.

Investors asked Huatai Securities about their specific plans for cultivating a first-class investment bank, such as mergers and reorganizations within the industry.

Zhou Yi, Executive Director and CEO of Huatai Securities, stated that Huatai Securities is firmly deepening the "dual-wheel drive" strategy of wealth management and institutional services empowered by technology, always focusing on customer needs, continuously promoting internal "one customer," external "one Huatai," and integrated operations both internally and externally, striving to build a platform-based, integrated, and ecological full-service chain system, and comprehensively enhancing core competitiveness through its high-quality development, firmly moving towards becoming a first-class investment bank.

Regarding questions about mergers and acquisitions in the securities industry, Wu Zongmin, President of CMS, stated that mergers and reorganizations are important means to achieve growth and strength. Through mergers and reorganizations, capital expansion and customer resource integration can be realized, accelerating the ability to serve the goal of building a strong financial nation. The company will continue to track and study opportunities related to industry mergers and reorganizations. Currently, the company has no undisclosed information that needs to be disclosed.

Outlook for Fourth Quarter Performance

The third-quarter performance has concluded, and investors are showing more concern for the fourth quarter and even the annual performance.

Investors inquired about the new account openings since the market started on September 24, and which business segments have benefited significantly? What is the outlook for the fourth quarter and the entire year's performance?

Wu Zongmin, President of CMS, stated that due to market conditions, the number of new accounts opened by the company in October increased several times compared to September. Recently, the A-share market has shown significant volume, with trading volume in October for stock funds increasing significantly compared to September; the recent rise in market enthusiasm has positively promoted the company's brokerage business, which will continuously enhance the comprehensive competitiveness of the brokerage business and promote long-term high-quality development.

Regarding the outlook for the entire year of 2024, Xi Zhiying, head of the accounting institution at CITIC Securities, stated that since the beginning of this year, CITIC Securities has actively served the development of the real economy and the enhancement of capital market functions, with steady development across various businesses, achieving steady growth in operating income and net profit in the first three quarters. For the whole year, the company will aim to build a first-class investment bank, continuously expand the customer market, actively enhance comprehensive business competitiveness, strive to maintain stable operating performance, and contribute to the construction of a strong financial nation Zhang Ming, Chairman and General Manager of Caida Securities, stated that since late September, with the implementation of multiple policies to boost the market, medium- and long-term funds have entered the capital market, leading to active trading in the securities market and a noticeable recovery in market sentiment.

The company will seize the favorable policies, adhere to the target tasks and reform measures set at the beginning of the year, and with rock-solid confidence, a vigorous fighting spirit, and unyielding perseverance, actively take the initiative, seize opportunities, enhance the vitality and momentum of market-oriented reforms, strengthen compliance and risk management to improve quality and efficiency, and comprehensively promote the in-depth development of the company's reform efforts and transformation upgrades.

Regarding the performance outlook for the fourth quarter, Fan Li, Chairman of Soochow Securities, stated that in the fourth quarter, the company will closely follow policy guidance, seize market opportunities, fully leverage the advantages of the Beijing Stock Exchange, actively layout mergers and acquisitions business, steadily advance investment banking business, and enhance its ability to serve the real economy.

Deepening the transformation of wealth management, continuously expanding the scale of asset management, and providing higher quality services for clients' wealth preservation and appreciation. The company will conduct in-depth analysis of market conditions, strengthen investment research capabilities, and strive for stable returns in investment trading business. The company will make every effort to promote various operational management tasks, consolidate a stable and good operating situation, and create greater value for investors.

Author of this article: Hu Feijun, Source: Securities China, Original Title: "Securities Firms Hold Intensive Performance Briefings! Leading Securities Firms Respond to the M&A Wave"