Securities

Year in Review

In 2023, CITIC Securities remained committed to improving its business structure and enhancing the effectiveness of services to the real economy. The company made substantial advancements across a range of operational and management tasks, resulting in significant achievements. The company continued to lead the industry in terms of performance and market rankings across key business sectors.

Investment Banking

In the domestic equity financing business, CITIC Securities completed a total of 140 A-share lead underwriting transactions, with an aggregate value of approximately RMB277.913 billion (including cash and asset private placements), representing a market share of 24.50% and ranking first in the market. In overseas equity financing (calculated based on an even distribution of the total offering size among all bookrunner roles), CITIC Securities completed 32 overseas equity transactions with an aggregate underwriting amount of approximately US$1.782 billion. It ranked second among Chinese securities companies within the equity financing business in the Hong Kong market. In the reporting year, CITIC Securities debt financing business continued to maintain a leading position in the industry, underwriting a total of 4,200 debentures and ranking first among its peers. The underwriting amount increased by 21.01% year-on-year to RMB1,909.992 billion, accounting for 6.85% of the total market underwriting amount and ranking first in the market. It also represented 14.14% of the total underwriting amount across securities companies, ranking first in the industry.

In the financial advisory business, CITIC Securities topped the market in A-share material asset restructuring, undertaking RMB118.070 billion in deals. It completed transactions totaling US$51.795 billion in global mergers and acquisitions involving Chinese enterprises, ranking second among Chinese securities companies.

In the New OTC Market business, CITIC Securities continued to capitalise on deepening reforms of the capital markets, increasing its coverage of innovative small and medium-sized enterprises and meeting the core objective of expanding its customer base. As the nominated adviser and broker of the New OTC Market, CITIC Securities completed seven listing projects in the reporting period, facilitating targeted financing of RMB561 million for the listed companies. It conducted continuous supervision of 24 listed companies, 13 of which have entered the innovation tier.

Wealth Management

CITIC Securities placed a strong focus on customising client management in domestic wealth management, optimising its organisational structure, and enhancing the headquarters’ ability to enable and guide business development at branch offices. The company established a diverse team of experts and introduced innovative wealth management service models. This enabled the company to offer comprehensive financial solutions covering the entire life cycle of “individuals–families–businesses–society”. Additionally, the company accelerated its global presence in wealth management by establishing the CITIC Securities Entrepreneur Office (Hong Kong) service brand and launching the Singapore wealth management platform. These initiatives aimed to enhance and expand the scope of international services, better serving both domestic and international clients with global asset allocation and trading services.

As of the end of the reporting period, CITIC Securities had accumulated over 14.2 million clients with total client assets under custody reaching RMB10 trillion, representing a year-on-year increase of 4%. The total assets under management (AUM) of the non-monetary market public mutual fund reached RMB190.2 billion, ranking first in the industry.

Financial Markets

CITIC Securities operates a comprehensive trading business with service offerings including equity derivatives, fixed-income, commodities, securities financing, and proprietary trading. The equity derivatives business continued to innovate its products, enhance its business structure and expand its application scenarios. It maintained a strong presence with a wide client base, diverse product offerings, excellent trading capabilities, and relatively stable returns. Additionally, the market-making business consistently ranked among the top global market in the market. The overseas equity derivatives business covers mainstream international markets, providing clients with cross-border, one-stop global market investment and trading services. In the fixed income business, the company continued to enhance its profit models, improve its product design capabilities and trading services, and provide clients with integrated financial services. Additionally, CITIC Securities’ sales volume for interest rate products has ranked first in the industry for several consecutive years. In the financing business, the company operates with a customer-centric philosophy, focusing on meeting client needs. It strengthened its presence among core customer segments, expanding its business scope and maintaining a leading market share. The stock pledge business remained committed to serving the real economy, continuously improving the quality of credit assets, and achieving market-leading growth in scale. The overseas business segment continued to grow, supported by an expanding product portfolio and business model. This growth was accompanied by enhanced business management capabilities, contributing to the overall success of the segment.

Asset Management

CITIC Securities seamlessly transferred its asset management business to CITIC Securities Asset Management, officially established in 2023. This transition allowed the company to operate multiple licensed businesses effectively. On the domestic front, the company attained an A-rating for its fundamental performance in the National Council for Social Security Fund assessment. It actively pursued the transformation and establishment of a professional, systematic, and customised framework for proactive management. In addition, it optimised its banking business structure, intensified efforts in developing corporate clientele, and achieved significant growth in both the number and scale of corporate clients. The scale of overseas asset management steadily increased, marked by the successful issuance of two public funds and the introduction of cross-border wealth management products. As of the end of the reporting period, the company’s AUM amounted to RMB1,388.461 billion (excluding pension products). The company’s private equity management business (excluding pension funds, public offering products and asset securitisation products) attained a market share of approximately 13.71%, ranking first in the industry.

CITIC Securities is the largest shareholder of China Asset Management Company Limited (ChinaAMC). By the end of 2023, the AUM of ChinaAMC reached approximately RMB1,823.564 billion of which mutual funds accounted for RMB1,317.644 billion, and institutional and overseas business accounted for RMB505.92 billion.

Equity Investment

As an alternative investment arm of CITIC Securities, CITIC Securities Investment actively supported national strategic initiatives. It systemically positioned itself within strategic emerging industries by identifying and investing in high-quality enterprises, operating in areas such as new industrialisation, manufacturing transformation and upgrading, independent innovation, and cutting-edge technologies. It prioritised enterprises with strong growth potential, as well as leading product and technological advantages. Through synergy and collaborations, CITIC Securities supported its invested enterprises in achieving sustainable growth and steadily expanded its investment presence in advanced manufacturing, new energy, information technology, new materials, biotechnology, and other related sectors.

As the private equity platform to raise and manage funds for CITIC Securities, GoldStone Investment capitalises on its fundraising advantages. In 2023, it successfully registered a new fund, raising a total of RMB16.79 billion. Serving as a fund manager, GoldStone Investment supported the national strategic plan for emerging industries through equity investments. It consistently invested in technology-driven enterprises that contributed to the real economy, participated in major national projects, and placed emphasis on supporting enterprises that played an important role in breakthrough of key technological barriers. These approaches ensured the stability of the industrial supply chain and implemented the “dual carbon” strategy. GoldStone Investment also made equity investments in a portfolio of enterprises excelling in key sectors including new materials, new energy, next-generation information technology, high-end manufacturing, healthcare, and modern services. By utilising equity investments, the company actively supported the national strategy of technological innovation.

Year in Review

Despite a complex and ever-changing market environment in 2023, China Securities worked hard and maintained momentum in high-quality development. In 2023, the company achieved revenue of RMB33.979 billion and profit attributable to shareholders of RMB7.034 billion.

Investment Banking

In 2023, CSC Financial completed equity financing projects for 67 companies with a total underwriting value of RMB94.776 billion, both ranking second in the industry. The company acted as the lead underwriter for 33 initial public offerings (IPOs) with a total underwriting value of RMB40.754 billion, ranking second and third in the industry, respectively. CSC Financial served as the sponsor for IPOs of four central state-owned enterprises, maintaining its position as the industry leader for five consecutive years. During the year, CSC Financial remained committed to supporting the real economy through financial services. It facilitated 30 IPO projects in strategic emerging industries and 15 IPO projects for national specialised and sophisticated “little giant” enterprises. CSC Financial achieved the top position in the market by being the leading sponsor for IPOs on the STAR Market, the ChiNext Board, and of “little giant” enterprises.

CSC Financial continued to maintain strong momentum in its debt financing business, completing a total of 3,280 lead underwriting projects with an aggregate value of RMB1,545.706 billion, both ranking second among its peers. The company topped the market with 1,007 lead underwriting projects for corporate bonds with a total underwriting value of RMB417.967 billion, ranking second in the industry. In 2023, the company diligently implemented significant national strategic policies by taking the lead in underwriting 105 green bonds. The total underwriting value amounted to RMB62.621 billion, including 21 individual bonds specifically for carbon neutral projects with a total underwriting value of RMB7.702 billion.

In the financial advisory business, CSC Financial completed nine projects of the acquisition of assets through issuance of shares and major asset restructuring, ranking third in the industry. The total transaction amount was RMB69.609 billion, ranking second in the industry.

Wealth Management

As of the end of 2023, CSC Financial’s securities brokerage business added 1.22 million new customers out of 13.37 million in aggregate, representing an increase of 10.20%, with a total client assets under custody of RMB5.14 trillion. The revenue from the agency sale of financial products increased by 3.97% over the year and the scale of financial product was up 2.37%. The monthly average of active customers on the “Qingting Dianjin” mobile app ranked seventh in the industry. China Futures, a subsidiary of CSC Financial, recorded its best-ever performance in terms of both operating revenue and net profit. It achieved total turnover of RMB20.69 trillion in agency transactions, representing year-on-year growth of 39.18%. The number of new clients increased by 28.78% compared to the previous year. Additionally, the scale of client equity grew by 17.08% year-onyear. By the end of the year, China Futures secured the second position in the industry in terms of asset management scale.

Trading and institutional client services

CSC Financial’s trading and institutional client services business includes equity, fixed income, investment research and prime brokerage services. The company provides liquidity market-making services for stocks, funds, options, futures, and other instruments listed on exchanges. In order to provide diversified products and trading services, the company has continually enhanced its product offerings, including the “CSC World Asset Risk Parity Macro Hedge Index (WARPMACRO)” and other strategy index products. CSC Financial continued to maintain its leading position in the bond sales business, with its credit bond sales volume ranking second among domestic financial institutions. CSC Financial ranks among the top in terms of forex and gold trading volumes. The company has established a comprehensive market-making presence across the interbank market, Shanghai and Shenzhen Stock Exchanges, and the government bond futures market. Its proprietary market-making system facilitated nominal principal turnover of over RMB3 trillion in government bond futures trading throughout the year. CSC Financial also expanded its market-making business to exchange-traded bonds, with turnover exceeding RMB2 trillion, while its interbank market trading volume surpassed RMB11 trillion. It has been recognised as an “Northbound Top Market Maker” by Bond Connect Company Limited for two consecutive years. In the first half of 2023, CSC Financial ranked second in the industry with a market share of 5.12% in commission income from its Public Offering Fund. The number of clients in the company’s prime brokerage system reached 12,953 households, representing a year-on-year increase of 38.71%. CSC Financial served as the custodian for 88 public funds, ranking first industrywide in terms of the number of funds under custody. Its subsidiary, China Securities Investment, completed investments in 26 projects. These included 10 follow-on investments in IPO projects on the STAR Market, bringing the total investment amount to RMB1.335 billion.

Asset Management

As of the end of 2023, CSC Financial had RMB469.4 billion in total assets under custody, including a total of 648 products of collective asset management business, targeted asset management business and specialised asset management business, with a scale of RMB120.736 billion, RMB160.423 billion and RMB188.242 billion respectively. CSC Financial’s subsidiary, China Fund Management, managed a total of 54 mutual funds (including seven newly established products in 2023). Among its 47 funds included in the ranking, 30 funds ranked in the top 50%, with 19 funds ranking in the top 20% and 10 funds ranking in the top 10%. Its another subsidiary, China Capital Management, as of the end of 2023, ranked fifth among securities brokerage subsidiaries in the scale of its average monthly paid-in capital.

China Securities (International), a subsidiary of CSC Financial, participated in and completed eight IPO sponsorship projects in the Hong Kong market, with a total equity financing scale of HK$8.327 billion. In the offshore market, the company participated in and completed 105 bond underwriting projects with a total underwriting scale of HK$223.8 billion. Among them, 44 global coordinator projects achieved a total underwriting value of HK$71.9 billion. In the third quarter of 2023, the company’s agency stock trading volume secured a position in the B group ranking of securities firms on the Hong Kong Stock Exchange for the first time, reinforcing its standing in the market.