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CITIC Securities Co Ltd, the brokerage unit of China's biggest investment company, more than tripled its earnings for the period ending in December, 2003 as the rising stock market helped it arrange more share sales and earn more for trading shares on its own account.
Net income rose to 365.49 million yuan (US$44.03 million), or 0.15 yuan per share, from 110.08 million yuan, or 0.04 yuan per share, for the year-ago period.
Revenue fell 1.23 percent to 816.18 million yuan from 826.38 million yuan the year before. The securities unit, 31.75 percent owned by China International Trust and Investment Corp, proposed to pay a dividend of 0.11 yuan per share to shareholders.
"Citic Securities rode onto the market rally last year and its equity investment proved to be successful and contributed a handsome revenue stream," said Wu Jie, a trader with Kinghing Securities Co Ltd.
The mainland's two stock markets in Shanghai and Shenzhen rebounded by 10 percent last year after reversing the decline of two and a half years, enabling institutional investors, like CITIC Securities and mutual funds, to book hefty returns from equity investment.
CITIC Securities, the largest listed brokerage house on the mainland's stock markets, earned 120.68 million yuan for trading stocks, mutual funds and bonds on its own account last year, compared with 32.41 million yuan the year before.
Revenue from the investment banking segment rose 209.52 million yuan from 207.10 million yuan the year before as more companies sold new shares or bonds amid the market rally last year.
CITIC Securities was hired by 74 companies to arrange initial public offering sales, rights offers and bond sales last year.
The brokerage house was the lead under-writer of China Yangtze Power Co Ltd, which raised nearly 10 billion yuan in the biggest IPO in the mainland last year.
Revenue from the stockbroking business from stock commission fees, was 256.47 million yuan last year, down from 263.76 million yuan a year before.
Currently, China's brokers charge investors stock commission in a range from 0.015 percent to 0.3 percent.
(Shanghai Daily March 30, 2004)
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