Despite reporting 172 per cent growth in first-half profit, brokerage house Taifook Securities Group said it will gradually reduce its focus on its retail business and instead concentrate on high-net worth client wealth management and institutions in the face of increased competition from banks.
'We could not rely solely on broking business as it would be difficult to compete for retail clients,' said group managing director and chief executive Peter Wong Shiu-hoi yesterday.
On the back of strong stock market turnover boosting both its trading volume and client rolls, the firm founded by New World Development chairman Cheng Yu-tung reported a 172 per cent rise in net profit to HK$82.3 million for the six months to June. Revenue jumped 86 per cent to HK$340.5 million.
The company proposed an interim dividend of seven HK cents compared with two HK cents last year.
Taifook Securities said the growth was due mainly to the 93 per cent surge in average daily turnover on the Hong Kong stock market in the first six months to HK$32.6 billion. Overall, the profitability of Hong Kong's 450 stockbrokers in the period doubled over the previous six months, to HK$7.4 billion, according to a Securities and Futures Commission report last week.
Taifook increased its client numbers by 10 per cent compared with a year earlier, to a total of about 80,000 but Mr Wong said this does not hint at a trend.