Brokerages reported widespread profit growth in the first three quarters of the year, alongside expanding asset scales. Mid-sized and internet-focused brokerages led the stock price rally, while some traditional firms lagged or traded below book value.
**Three Brokerages Surpass Trillion-Yuan Asset Mark** Citic Securities (600030.SH) remains the industry leader, with total assets reaching ¥2.03 trillion as of September 2025, up 12% from June. Guotai Haitong (601211.SH) followed closely with ¥2.01 trillion, an 11.3% increase. Notably, Huatai Securities (601688.SH) became the third A-listed brokerage to cross the trillion-yuan threshold, with assets rising to ¥1.03 trillion from ¥900.7 billion in June. Analysts highlight Citic’s dominance in total assets and client deposits, while Guotai Haitong leads in net capital and proprietary trading scales.
Guangfa Securities and China Galaxy (601881.SH) also posted rapid asset growth, positioning them as potential candidates to join the trillion-yuan club. The sector’s expansion reflects robust investor participation in the bull market, with tech-savvy firms like Huatai and Galaxy leveraging digital platforms to attract clients.
**Internet Brokerages: Mixed Performance** East Money Information (300059.SZ), the internet brokerage leader with a ¥400 billion market cap, saw a 1% stock decline despite a 50.6% net profit surge. Its subsidiary, Tian Tian Fund, lost ground to Ant Group’s fund sales platform, now holding just 42.5% of Ant’s equity fund scale. In contrast, Compass (300803.SZ) and Xiangcai Securities surged 144% and 79% YTD, buoyed by strong earnings and strategic acquisitions.
**Valuation Divergence** While mid-sized brokerages like Xiangcai and Guosheng Securities (002670.SZ) outperformed, some firms traded at lofty valuations—Compass’s P/E hit 266x. Analysts favor undervalued H-shares, such as Citic Securities H (6030.HK) and CICC H (3908.HK), trading below book value. Conversely, Guoyuan Securities narrowly exited "price-to-book below 1" territory, while Huachuang Yunxin and SDIC Capital remained undervalued.
**Underperformers and M&A Impact** Mergers, like Guolian-Minsheng and Guotai-Haitong, drove asset growth but left some stocks stagnant. China Merchants Securities (600999.SH) slid to eighth in market cap rankings, and Capital Securities (601136.SH) reported slower profit growth ahead of its Hong Kong IPO. Regulatory calls for state-owned firms to enhance valuations may spur action among laggards.
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