Prior to this, Industrial Securities issued a public offering plan in August, 20021year, and distributed it to all shareholders according to the proportion of no more than 3 shares per 10 share. The funds to be raised do not exceed 654.38+04 billion yuan, and all of them will be used to increase capital and replenish working capital after deducting the issuance expenses. The rights issue lasted for 7 months and was approved by the CSRC on April 654.38+08, 2022.
Industrial Securities said that the decline in performance in the first quarter of 2022 will not have a major impact on this public offering. However, after the rights issue, the earnings per share and weighted average return on equity of Industrial Securities will decrease, and the immediate return of the company after the rights issue will be diluted.
The reason why we attach importance to the publication of the first quarter results in the same period to explain the impact of the decline in performance on the rights issue is partly because Article 7 of the Measures for the Administration of Securities Issuance of Listed Companies requires the sustainability of the profitability of listed companies, and stipulates that the operating profit of listed companies that have publicly issued securities in the last 24 months is not less than 50% of the previous year.
At present, the company's rights issue has raised 654.38+04 billion yuan, which has not yet landed. At the same time, the company's operating profit in the first quarter of this year decreased by 74.54% compared with 202 1 year-on-year, and the decline rate far exceeded 50%. This means that if Industrial Securities wants to raise funds through public offering this year, it must ensure a substantial increase in the performance in the second, third and fourth quarters and share the loss in the first quarter, and adjust the decline in operating profit for the whole year to less than 50%, so as to meet the requirements of sustained profitability.
The fund business that relies on the rate of return saw a sharp drop in fund business income in the first quarter.
According to the first quarterly report, the main reason for the decline in the performance of Industrial Securities is that the equity self-investment business and asset management business (including fund management) are affected by short-term market fluctuations in the capital market. In the first quarter of 2022, the A-share index fluctuated and fell. Shanghai Composite Index fell 10.65%, Shenzhen Component Index fell 18.44%, Shanghai and Shenzhen 300 Index fell 14.53%, China Securities 500 Index fell 14.06%, and Growth Enterprise Market Index fell 19.96.
The business model of Industrial Securities is not balanced. Unlike most brokers, the income from securities and futures brokerage business of Industrial Securities has been extremely low for a long time. In 20 19 and 2020, it ranked among the three major businesses, namely asset management, institutional service and self-investment business, and became the business with the lowest contribution rate of domestic income.
In the first quarter, due to the year-on-year decrease in investment income of trading financial assets, the investment income of Industrial Securities decreased by150.67%; Other business income factors The sales revenue of bulk commodities of Xing Zheng Risk Management Co., Ltd. decreased by 87.438+0% year-on-year; The net fee and commission income decreased by 24.5 1%, mainly due to the year-on-year decrease in fund management business income. The above factors led to a year-on-year decrease of 86.93% in the company's net profit.
On the revenue side, institutional service business is the main source of income for Industrial Securities, and the proportion of 20 19-202 1 income is 4 1.35%, 35.05% and 30.24% respectively. Institutional services include research services, asset custody and outsourcing services and institutional transaction services, among which the key business is product custody of securities private investment funds. By the end of 20021,Industrial Securities had added 2 132 private equity investment funds, ranking fourth in the industry. At the end of the period, 4,709 private equity investment fund products were managed, ranking fifth in the industry. This also makes the company more dependent on private equity funds in revenue.
In terms of asset management business, the scale of Industrial Securities Public Offering of Fund far exceeds that of brokers and private equity funds. By the end of 20021,the Public Offering of Fund management business of Industrial Securities was entrusted to the holding subsidiary Xing Zheng Global Fund, and the scale of managing Public Offering of Fund reached 59,065,438+75 million yuan, accounting for 87.69% of the total assets management scale. This also shows that Public Offering of Fund is the focus of the asset management business of Industrial Securities.
From the profit side, Xing Zheng Global Fund 202 1 contributed a net profit of 2.235 billion yuan to Industrial Securities, accounting for 38. 17% of the company's total profit. As Industrial Securities only holds 565,438+0% equity of Xing Zheng Global Fund, the contribution profit rate is 24.03% according to the equity method.
In addition, southern fund, who holds 9% of the shares, and Xing Zheng Asset Management, who holds 65,438+000% of the shares, are engaged in fund business under Industrial Securities, with profit ratios of 4% and 65,438+02% respectively. Together with the 24% profit contributed by Xing Zheng Global Fund, the Public Offering of Fund business contributed 40% profit to Industrial Securities.
According to the research report of GF Securities, in 20021year, the profit contribution rate of Industrial Securities' public offering/secondary asset management was 40%, second only to Orient Securities' 49%. Compared with China Merchants Securities Fund Business, which contributed 20% of the profits, Guangfa Securities Fund Business contributed 23% of the profits, and Industrial Securities' dependence on the fund business nearly doubled in terms of yield.
Source: GF Securities Research Report
Both income and profit depend on fund business, which easily leads to the risk of single product income structure. In the first quarter of 2022, the income of Industrial Securities decreased by 69.34% and the net profit decreased by 72.72%, mainly due to the sharp decrease in the income of self-operated equity investment business and asset management business (including fund management).
In addition, the net cash flow generated by the company's operating activities decreased by 82. 16% year-on-year, mainly because the net cash received from securities trading and commodity sales decreased year-on-year, while the net cash paid by repurchase business funds increased year-on-year.
It is planned to raise 654.38+04 billion yuan to supplement working capital.
In addition to the decline in performance, the net stable capital ratio of Industrial Securities began to drop sharply in 2020. In 2020, the company's net stable capital ratio decreased from 18 1.67% to 132.5%, and in 2026, the company's net stable capital ratio decreased from 132.5% to 65,438. It shows that the company's stable sources of funds are getting less and less, and its ability to deal with the structural problems of medium and long-term assets and liabilities tends to weaken.
In this context, Industrial Securities issued a plan to raise funds by rights issue in August 20021year, and the funds to be raised should not exceed1400 million yuan. After deducting the issuance fee, it will all be used for the company's capital increase. Specific investment projects include the development of margin trading, investment banking and investment trading, as well as increasing investment in information systems and compliance risk control.
On the day of the rights issue announcement, the share price of Industrial Securities fell, but until June 14, 2022, the rights issue of Industrial Securities still did not land, which attracted investors' dissatisfaction. Some investors left a message on the e-interaction of the Shanghai Stock Exchange: "When will the rights issue?" "If the efficiency is too low, it will fall" and "the rights issue is generally completed within one month".
Source: SSE e Interactive official website
Whether Industrial Securities can successfully issue shares is still unknown.
Tracing back to 20 16 years, Industrial Securities raised122.58 million yuan at an average price of 8. 19 yuan/share, and the subscription ratio was 95.94%. However, by the close of June 14, 2022, the share price of Industrial Securities had fallen to 7.27 yuan, with a single share decline of 1 1.23%. 20 16-202 1, and the dividend cash per share of Industrial Securities is 0. 15 yuan (including tax), 0. 15 yuan (including tax), 0.05 yuan (including tax), 0.08 yuan (including tax) and 0./respectively.
Even if the dividend amount is added together with the current share price of Industrial Securities, it is 7.93 yuan/share, far lower than 8. 19 yuan/share. That is to say, the original shareholders who have been holding shares of Industrial Securities since 20 16 have lost 3. 17%. This has also become a reason why the rights issue has been widely criticized by investors.
In fact, the minority shareholders of Industrial Securities will have certain losses if they choose not to issue shares. If minority shareholders give up the rights issue, they will face the risk of dilution of earnings per share and loss of stock earnings. If minority shareholders choose to issue shares, they will also face the risk of falling stock prices in the short term.
Previously, CITIC Securities successfully raised 22.396 billion yuan in A shares in June of this year, with a subscription rate of 9.7 17%. orient securities planned to raise16.8 billion yuan in A+H shares, but it actually landed in May127/kloc-0. There is a market view that the subscription rate of orient securities's rights issue is not high, and the direct reason is that the subscription price is twice that of H shares, and the price is upside down. Therefore, even if the total number of shares increases and the share price falls after the rights issue is completed, there are still a large number of H-share investors who choose not to participate in this rights issue.
Whether the rights issue of Industrial Securities can be carried out smoothly and whether there will be a large-scale abandonment of shares depends on the recent development of the company's operating performance, the performance of the fundamentals of its financial situation, and whether the pricing of rights issue is fair.
Want to know more financial news in real time, please pay attention to us.