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Strong stock market gives securities firms profit a boost in Q3

2021-10-20 09:04
An investor looking at stock trading boards. Photo kinhtedothi.vn

HÀ NỘI — The active domestic market with high liquidity, mostly from local retail investors, has been supporting securities firms this year with many reporting outstanding performance. 

Data from the State Securities Commission (SSC) showed that by the end of August, the market capitalisation reached over VNĐ8.101 trillion (US$357.86 billion), equivalent to 138.6 per cent of GDP, up 21.27 per cent compared to the end of 2020.

The stock market has mobilised around VNĐ292.1 trillion for the economy in the first nine months of the year, up 12 per cent over last year, with the average trading value reaching more than VNĐ24 trillion per session, up 224 per cent year-on-year.

During the period, the number of new accounts opened by domestic investors was 957,215, while the total number of new accounts opened for the last three years in 2018, 2019 and 2020 combined only was 837,345 accounts.

These factors are believed to be the main drivers for securities firms’ business results.

In its third-quarter financial statement, Thành Công Securities Company (TCSC) reported its total revenue of VNĐ69.6 billion, up 60 per cent year-on-year. Of which, proprietary trading accounted for the largest proportion of about 24 per cent of the total revenue, reaching VNĐ24 billion, however, it decreased by 25 per cent year-on-year. 

Meanwhile, revenue from issuing stocks witnessed an impressive growth to over VNĐ12 billion, 5.5 times higher compared to the same period last year. 

Brokering activities also earned three times higher than last year to VNĐ13 billion.

Operating expenses in the third quarter were recorded at VNĐ17 billion, up 66 per cent year-on-year. Deducting expenses, the company posted a net profit of VNĐ41 billion during the period, up 76 per cent.

For the first nine months, its revenue rose 122 per cent to VNĐ244.9 billion, with profit after tax reaching VNĐ149.3 billion, 4.3 times higher than last year. 

Similarly, Asia - Pacific Securities JSC (APEC) also saw good results in the third quarter of 2021, with its revenue reaching over VNĐ134 billion, up more than 5 times compared to last year. 

With the strong growth of the stock market, the securities firm’s brokerage market share accounted for 0.15 - 0.2 per cent of the total market. Therefore, revenue from brokering activities grew to 84.5 per cent over the same period last year.

The company’s operating expenses rose slightly over last year, while administrative expenses reported a small fall, leading to an increase of nearly 7 times compared to the same period in 2020 in profit after tax to VNĐ97 billion. This is a historically high profit after tax that APEC has recorded during more than 15 years of operation.

As of September 30, its revenue reached more than VNĐ205 billion, up 84 per cent over the same period, resulting in profit after tax of VNĐ134.7 billion, nearly 7 times higher than last year. 

SmartInvest Securities JSC also posted a jump of 87 per cent in total revenue to VNĐ252 billion. Although the securities’ brokerage business is still modest, it also recorded good performance after earning VNĐ6.1 billion, compared to VNĐ32 million in the same period last year.

As a result, the company’s profit after tax was 7 times higher than last year to VNĐ136 billion. 

In the first nine months of 2021, SmartInvest’s revenue and profit after tax both surged 243 per cent to VNĐ136 billion and VNĐ141 billion, respectively. 

Meanwhile Bảo Minh Securities Company was the first securities firm to post a decline in revenue in the third quarter. Of which, its revenue fell 11 per cent to VNĐ55 billion. 

The main reason for the decline in revenue was due to losses in the proprietary trading, the company said, with a net loss of VNĐ66 billion. 

Therefore, the firm reported a loss of more than VNĐ38 billion during the period. It lost VNĐ26 billion last year. — VNS

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