For stock market insights, rely on authoritative, professional, timely and comprehensive analyst research to help uncover potential thematic opportunities. CITIC Securities recently released its third-quarter report.
In the first three quarters of 2026, CITIC Securities achieved revenue of 66.59 billion yuan, up 18.6% year on year, and net profit attributable to shareholders of 31.022 billion yuan, up 32.66% year on year. However, in the third quarter alone, CITIC Securities revenue was 16.898 billion yuan, down 36.32% quarter on quarter and down 26.59% year on year, while net profit attributable to shareholders was 7.679 billion yuan, down 41.5% quarter on quarter and down 20.19% year on year.
The sharp decline in third-quarter revenue and net profit was mainly due to the deep correction in the equity market during the quarter combined with a high base effect. In the third quarter, CITIC Securities' "net investment income plus net gains from changes in fair value" fell 70.77% year on year.
In the first three quarters, CITIC Securities' net fee income from brokerage, asset management and investment banking businesses all trended upward, net interest income grew more than threefold year on year, and net gains from changes in fair value increased nearly 32 times. Among these, net investment banking fee income was 5.124 billion yuan, up nearly 39% year on year.
As of October 28, CITIC Securities had the largest number of A-share IPO sponsorship reserve projects, but the quality of some projects is disputable. In the third quarter of 2026 alone, Zuojiang Technology and Jiayuan Technology, which CITIC Securities sponsored for IPO listing, received administrative penalty notices for financial fraud, and convertible bond issuer Sichuang Yihui, which CITIC Securities sponsored, was prosecuted for the crime of fraudulent issuance of securities and the crime of irregular disclosure and failure to disclose important information.
Sharp drop in third-quarter net investment income
In the first three quarters of 2026, CITIC Securities achieved revenue of 66.59 billion yuan, up 18.6% year on year, and net profit attributable to shareholders of 31.022 billion yuan, up 32.66% year on year. In the first three quarters of this year, CITIC Securities' net profit attributable to shareholders already exceeded the full-year level of 2025 (30.076 billion yuan), setting a new historical high.
However, on a quarterly basis, CITIC Securities' third-quarter performance declined severely. In 2026 Q3, the company achieved revenue of 16.898 billion yuan, down 36.32% quarter on quarter and down 26.59% year on year, and net profit attributable to shareholders of 7.679 billion yuan, down 41.5% quarter on quarter and down 20.19% year on year.
Research suggests that the sharp decline in CITIC Securities' third-quarter revenue and net profit was mainly due to the deep correction in the A-share equity market in the third quarter, as well as the high base effect from the first half of the year and the third quarter of last year.
In the third quarter of 2026, CITIC Securities' net fair value gains were -41 million yuan, turning negative from positive a year earlier, while net investment income was 3.755 billion yuan, down 68.55% year on year. In the first three quarters, net investment income was 17.978 billion yuan, down 45.25% year on year. The company said the decline in net investment income was mainly due to reduced investment income from the disposal of financial instruments.
In the third quarter, CITIC Securities' "net investment income plus net gains from changes in fair value" was 3.714 billion yuan, down 70.77% year on year from 12.704 billion yuan in the same period last year.
In the first half of 2026, CITIC Securities' securities investment business revenue was 19.854 billion yuan, accounting for about 40% of total revenue. Calculated under the measure of "net investment income plus net gains from changes in fair value minus investment income from associates and joint ventures," CITIC Securities' investment income in the first half of this year was 26.927 billion yuan, accounting for about 54% of total revenue.
Source: Semi-annual report. With investment income accounting for 40% to 50%, when major changes occur in the equity market, performance volatility becomes more severe, because fixed costs and operating leverage amplify gains in favorable conditions and equally amplify drawdowns in adverse conditions.
It can also be seen that even CITIC Securities, the leading brokerage, cannot avoid the impact of market fluctuations on its proprietary trading book, especially because the high proportion of proprietary trading income in earlier periods led to a high base. In the third quarter, the Shanghai Composite Index fell about 6%, the ChiNext Index retreated more than 27%, and the STAR 50 Index retreated more than 30%. Proprietary trading was the main reason for CITIC Securities' single-quarter performance decline.
Brokerage, asset management, investment banking and net interest income all grew
Although investment-related income fell sharply in the third quarter, CITIC Securities' fee-based business income still maintained a growth trend. In the first three quarters of 2026, CITIC Securities' net fee income from brokerage business was 14.730 billion yuan, up 34.65% year on year; net investment banking business income was 5.124 billion yuan, up 38.90% year on year; net asset management business income was 10.867 billion yuan, up 24.86% year on year; and net interest income was 3.223 billion yuan, up 319.68% year on year, mainly from increases in margin financing and securities lending and customer deposit interest.
Net fee and commission income totaled 32.631 billion yuan, up 32.86% year on year, making it the primary growth engine.
In terms of cross-border expansion, CITIC Securities completed an H-share placement of 804 million shares, raising 16 billion yuan for internationalization business and strengthening its overseas capital platform.
A research report by China Merchants Securities titled "CITIC Securities (600030): Investment Income Drags, Wealth Management Resilience Stands Out" argued that CITIC Securities, as an aircraft-carrier-level brokerage, is oriented toward scale expansion and has revenue far higher than other leading brokerages. In terms of business, its wealth management transformation progress is encouraging, its investment banking advantage is far ahead, its institutional business leads comprehensively, its proprietary trading philosophy and efficiency lead the industry, its internationalization progress is far ahead, and its advantages in capital strength and scale effects are obvious.
However, considering intensifying market volatility, the report lowered previous assumptions such as investment return rates and market turnover, and estimated the company's net profit attributable to shareholders in 2026, 2027 and 2028 at 38 billion yuan, 39.1 billion yuan and 40.8 billion yuan, up 26%, 3% and 4% year on year.
Three sponsored projects in Q3 penalized or criminally prosecuted for financial fraud and fraudulent issuance
According to Wind data, as of October 28, 2026, CITIC Securities had the largest number of IPO reserve projects it sponsored, based on exchange acceptance and excluding companies already issued or terminated, at 49. Guotai Haitong followed closely with 46. CITIC Construction Investment, CICC, Guolian Minsheng and Huatai United had 29, 23, 22 and 21 reserve projects respectively, ranking third to sixth.
Source: Wind. Although CITIC Securities has the largest number of IPO reserve projects, the gap with Guotai Haitong is not large. Moreover, the largest number does not equal the highest quality; project quality must pass multiple verifications by regulators, the market, investors and time.
It is worth noting that among CITIC Securities' 49 reserve IPO projects, 29 are in a suspended review status. This batch of "suspended reviews," concentrated at the end of the third quarter, was mostly due to technical reasons such as expired financial materials. However, "stalemate projects" such as Hualong Securities and Hubei Bank, which have not advanced for three years since acceptance, are not due to technical reasons.
Among them, Hualong Securities itself had previously been held accountable by regulators for practice issues in sponsored projects, and its IPO process as an issuer has also long been stalled. CITIC Securities has long been the top investment bank, with the number of IPO companies it sponsors for listing consistently ranking first, but the number of terminations also ranks among the highest in the industry.
Due to reasons such as a high base, some projects sponsored by CITIC Securities were found to involve financial fraud or fraudulent issuance after listing, and problems were discovered in some during the review process. In the third quarter of this year, Zuojiang Technology (already delisted) and Jiayuan Technology, which CITIC Securities sponsored for listing, were heavily penalized in financial fraud cases.
The Zuojiang Technology case is a representative example of "fraud for the purpose of issuance." The core of the fraud method was "inflating the cost side, inflating the price side, and advancing the revenue side." In August 2026, a notice from the Beijing Securities Regulatory Bureau determined that Zuojiang Technology overstated revenue in its prospectus for 2017, 2018 and the first half of 2019 by 38%, 37% and 37%, respectively, and overstated total profit by 85%, 68% and 121% (the prospectus reporting period was from 2016 to the first half of 2019). This means that without the fraud, Zuojiang Technology could not have met the financial conditions for listing at that time.
More notably, CITIC Securities' ongoing supervision did not stop this six-year-long fraud, because Zuojiang Technology did not stop falsifying after listing. The notice further determined that in 2019, 2020 and 2021, Zuojiang Technology overstated operating revenue by 114.0959 million yuan, 106.7751 million yuan and 32.1572 million yuan, accounting for 52%, 53% and 27% of disclosed operating revenue in the respective periods, and overstated total profit as a percentage of the absolute value of disclosed total profit by 114%, 102% and 1,993%.
Jiayuan Technology demonstrated another concealed fraud method: cross-period adjustment and "pass-through transactions" without commercial substance. From 2019 to 2022, it inflated performance by recognizing revenue early, reversing it back and forth, and inserting purchase and sales chains without commercial substance.
From 2019 to 2022, Jiayuan Technology overstated operating revenue by 20.1560 million yuan, understated it by 6.8765 million yuan, overstated it by 28.0338 million yuan, and understated it by 25.6247 million yuan, representing 15.39%, 3.61%, 8.85% and 9.51% of the absolute value of disclosed operating revenue in the respective periods.
On August 21, 2026, Jiayuan Technology received an administrative penalty prior notice; starting August 25, its stock abbreviation was changed to "ST Jiayuan." Zuojiang Technology raised 365 million yuan in its initial public offering, and CITIC Securities received underwriting and sponsorship fees of 30.1887 million yuan. Jiayuan Technology raised a total of 1.080 billion yuan, and CITIC Securities received sponsorship and underwriting fees of 64.7898 million yuan.
So, given that two sponsored projects involved financial fraud during the reporting period, did CITIC Securities perform its duties diligently, and should it compensate investors for losses? Regardless of whether CITIC Securities will be held accountable, in the Zuojiang Technology and Jiayuan Technology projects, its due diligence performance was substantially short of the standards of "prudent verification" and "professional skepticism," and it may have failed to effectively perform the "gatekeeper" function of identifying systemic fraud.
Although not legally characterized as such, Zuojiang Technology and Jiayuan Technology were already highly close to fraudulent issuance in objective elements. The convertible bond project of Sichuang Yihui sponsored by CITIC Securities, however, was clearly characterized as fraudulent issuance.
In September 2026, the Hangzhou Municipal People's Procuratorate filed a public prosecution against Sichuang Zhilian (formerly Sichuang Yihui) and seven then-senior executives on charges including the crime of fraudulent issuance of securities and the crime of irregular disclosure and failure to disclose important information. The indictment determined that the company fabricated major false content in its prospectus, publicly issued bonds, and the amount involved was huge.
In January 2021, Sichuang Yihui issued convertible corporate bonds and raised 817 million yuan, with CITIC Securities serving as sponsor and lead underwriter. According to an administrative penalty decision issued by the Zhejiang Securities Regulatory Bureau, Sichuang Yihui was found to have conducted fictitious business through its wholly owned subsidiary Yihui Technology with companies such as Hangzhou Wenran, Shanghai Xifan and Shenzhen Yulin, overstating operating revenue by 34.9294 million yuan and overstating profit by 33.0217 million yuan in 2019 (20.03% of total profit for the period), and cumulatively overstating operating revenue by 96.4688 million yuan and overstating profit by 83.9414 million yuan in 2020, accounting for 67% of total profit for the period.
The Zhejiang Securities Regulatory Bureau fined Sichuang Yihui 85.70 million yuan, fined chairman Zhang Lizhong 7.5 million yuan and imposed a 10-year market ban.
In the third quarter of 2026 alone, Zuojiang Technology and Jiayuan Technology, which CITIC Securities sponsored for IPO listing, received administrative penalty notices for financial fraud, and convertible bond issuer Sichuang Yihui, which CITIC Securities sponsored, was prosecuted for the crime of fraudulent issuance of securities and the crime of irregular disclosure and failure to disclose important information. This shows CITIC Securities' sponsorship quality.
According to incomplete public information statistics, from October 2020 to July 2026, there were 16 regulatory measures directly related to CITIC Securities and its investment banking sponsorship business, including the number of sponsored representatives subject to regulation. Categorizing the reasons in the 16 measures by word frequency, the most frequent included related-party transactions, related parties and fund occupation; revenue recognition and distributor models; and internal control effectiveness.
Source: CSRC and exchange websites. Among the 16 regulatory measures, the Huimang Micro IPO project was "withdrawn upon investigation" and was investigated twice. Huimang Micro filed for the STAR Market in December 2021, was selected for an on-site inspection on January 7, 2022, and withdrew on January 21, only 14 days after being selected. Huimang Micro then switched to the ChiNext in May 2023, was again selected for an on-site inspection, and withdrew on January 3, 2024.
CITIC Securities was subject to a written warning self-regulatory measure by the Shenzhen Stock Exchange for failing to fully verify the effectiveness of Huimang Micro's distributor revenue internal controls, for inaccurate verification opinions, for inadequate verification of the capital flows of Huimang Micro and related parties, and for failing to pay attention to the accuracy of production cycle disclosure.
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