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BIZCHINA / News |
Hong Yuan says H1 profit may surge 22-foldUpdated: 2007-07-10 12:56 Hong Yuan Securities Co said its first-half profit will probably surge 22-fold, boosted by higher transaction fees amid a stock market rally, Bloomberg News reported today. The brokerage, the smaller of the Chinese mainland's two publicly traded brokerages, based in western China's Xinjiang Uygur Autonomous Region, didn't give a specific figure. Hong Yuan's net first-half net income last year was 45.7 million yuan (US$6 million). China's securities companies rely on brokerage fees to boost earnings. As investors transfer savings from banks to buy stocks in a market that has gained 88 percent this year, brokerages with more outlets are expecting greater income. "Hong Yuan's last half's profit was at a low point, this half's could be a peak," said Leo Gao, who helps to manage the equivalent of US$2.3 billion at APS Asset Management Ltd in Shanghai. "A large proportion of the broker's net income is expected to come from stock transaction income, which is hard to maintain as the market trading volume is abnormally high." The brokerage previously said its first-half profit would rise as much as 10-fold. Chinese companies are required under stock exchange rules to issue a statement if their earnings deviate from the previous result by more than 50 percent.
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