Recently, Capital Securities Corporation Limited (601136.SH) announced that it has officially submitted a prospectus to the Hong Kong Stock Exchange, initiating the A+H dual listing process. If the listing successfully passes the hearing, Capital Securities will become the 14th brokerage in China to achieve dual listing in both A and H shares.
As of the close on October 20, Capital Securities shares were priced at 21.44 CNY each, with a market capitalization of 58.603 billion CNY. Looking back at the firm's capitalization journey, it made its debut on the Shanghai Stock Exchange on December 22, 2022, becoming the first A-share listed brokerage of that year. At that time, it issued 273 million shares at a price of 7.07 CNY per share, raising a total of 1.932 billion CNY. On its first day of trading, the stock surged by 43.99%, closing at 10.18 CNY per share, with a preliminary effective subscription rate reaching as high as 2338.37 times, indicating strong market enthusiasm.
Financial data shows that from 2022 to 2024, Capital Securities' revenue increased from 1.588 billion CNY to 2.418 billion CNY; net profit attributable to the parent company rose from 555 million CNY to 985 million CNY. According to the prospectus, the average return on total assets for Capital Securities during 2022, 2023, and 2024 was 1.5%, 1.7%, and 2.2%, respectively, while the non-weighted average return on net assets was 5.4%, 5.7%, and 7.6%.
The prospectus mentioned that according to Frost & Sullivan, the compound annual growth rate (CAGR) of asset management scale in China's securities industry from 2022 to 2024 was -6.7%. In contrast, Capital Securities reported a CAGR of 15.8% during the same period. By 2024, the total number of asset management collective products issued by the company reached 846, ranking first in the industry; the asset management sector (excluding special asset management plans) achieved a net income of 870 million CNY, placing seventh in the industry.
The funds raised from this H-share listing are highly aligned with the company’s differentiation strategy, focusing on six key areas. The asset management business, as the core leading sector, will receive major investments, with plans to establish an asset management subsidiary to optimize multi-asset and multi-strategy layouts and to expand products in fixed income and interest-bearing securities. The investment business will increase its securities investment efforts and enhance international asset allocation. Meanwhile, the investment banking sector will concentrate on serving technology enterprises and the upgrading of capital industries. Wealth management services will accelerate the development of financial technology and advisory businesses. Additionally, funds will be allocated for IT system upgrades and digital transformation to strengthen information security and customer service capabilities.
It is understood that Capital Securities has long been implementing a development strategy centered around asset management, supported by retail and wealth management, as well as investment banking, with investment activities providing a balanced drive, forming a distinctive “Asset Management + Fixed Income” label. The purpose of the Hong Kong listing is to further broaden financing channels, optimize the shareholder structure, enhance international influence, and lay the groundwork for cross-border business expansion.
Notably, on the same day of the listing application, Capital Securities announced a simultaneous equity change, where Capital Group plans to transfer 97.42 million shares of A-shares (accounting for 3.56% of the total share capital) without compensation to Jing Investment Company. The company stated that this transfer would enhance business collaboration and support. Currently, the H-share issuance still requires approval from the shareholders' meeting as well as approval from regulatory bodies including the China Securities Regulatory Commission and the Hong Kong Stock Exchange, and the subsequent developments have drawn considerable market attention.
Comments