Haitong Securities Co's net income increased 22 percent on year in the first half as the stock market rebound sparked brokerage business.
Its net income grew to 2.5 billion yuan (US$365 million), or 0.30 yuan per share, and revenue rose 2.18 percent to 4.1 billion yuan on a yearly basis, the brokerage said in a preliminary earnings report to the Shanghai Stock Exchange yesterday.
"The growth in revenue is due to the rising turnover in the stock market in the second quarter, with the daily turnover peaking at 211.5 billion yuan, a 30 percent rise from the first three months," said Wang Yifeng, an analyst at Guosen Securities Co.
The Shanghai Composite Index has jumped nearly 70 percent this year so far, becoming the best-performing market in the world.
"Haitong's income in the first half was similar to our expectation. We estimated that its brokerage business, the main factor in its revenue growth, jumped 13.5 percent in the period, but its proprietary and investment bank business declined from a year earlier," said Liu Jun, an analyst at Changjiang Securities Co.
Liu said the resumption of initial public offerings will boost Haitong's underwriter fees business in the second half of this year.
He predicted that 106 brokerages in the country will report a 37 percent increase in revenue in the first six months on year, faster than market expectations, and the industry's net income will rise more than 80 percent this year.
(Shanghai Daily July 15, 2009)
