The company Beijing Compass Technology Development Co.,Ltd. (ASX: 300803) is persistently nurturing its securities brokerage ambitions through incremental investments.
On the evening of July 20th, Compass announced that its board had approved a proposal to inject an additional 200 million yuan in capital into its wholly-owned subsidiary, Maigao Securities Co., Ltd.
This marks the fifth capital increase Compass has made into Maigao Securities. Previous injections include 500 million yuan in July 2022, 200 million yuan in December 2024, another 200 million yuan in July 2025, and 100 million yuan in December 2025. Following this latest round, Maigao Securities' registered capital has grown from an initial 500 million yuan to 1.7 billion yuan, representing a substantial 240% increase.
Dubbed a "mini East Money," Compass is building a comprehensive wealth management platform. As of the market close on July 22nd, its share price stood at 81.13 yuan per share, down 3.24%, with a total market capitalization of 49.47 billion yuan.
However, in October 2025, the company terminated a private placement plan it had been preparing for over three years, which aimed to raise 3 billion yuan exclusively for capitalizing Maigao Securities. With ambitious expansion plans on one side and a suddenly closed refinancing channel on the other, the question arises: Is Compass's substantial cash investment paving the way for its dream, or filling a pit for an uncertain future?
Repeated Capital Infusions Over Five Years
Maigao Securities, formerly known as Wangxin Securities, was founded in April 1995 and is headquartered in Shenyang.
Due to poor management, Wangxin Securities incurred continuous losses from 2018 onwards and entered bankruptcy restructuring proceedings in July 2021. In July 2022, Compass secured the qualification as the restructuring investor for 1.5 billion yuan, acquiring 100% ownership. In January 2023, Wangxin Securities was officially renamed Maigao Securities.
Since the acquisition, Compass has injected a total of 1.2 billion yuan of its own funds into Maigao Securities across five rounds. The company stated that the latest 200 million yuan increase is intended to better meet the capital needs for Maigao Securities' business development, support its stable progress, and align with Compass's long-term strategy and core interests.
Financial analysts note that as a financial information service provider, Compass's revenue heavily depends on stock trading software sales and advertising, which are highly correlated with A-share market activity and subject to significant cyclical fluctuations. While the cumulative 1.2 billion yuan investment remains manageable, the capital required for Maigao Securities to evolve into a comprehensive securities firm would be far greater. Once capital-intensive businesses like proprietary trading and credit intermediation expand, the funding gap could widen rapidly. It is suggested that Compass focus on securing refinancing during available windows to avoid a piecemeal approach.
In fact, following the restructuring, in May 2022, Compass proposed a private placement of A-shares to raise up to 3 billion yuan, with all net proceeds earmarked for capitalizing Maigao Securities.
According to a revised plan from May 2025, the funds were allocated for wealth management business (up to 800 million yuan), margin trading startup capital (up to 500 million yuan), investment banking (up to 300 million yuan), securities investment (up to 400 million yuan), IT and compliance/risk control construction (up to 500 million yuan), and supplementing working capital (up to 405 million yuan).
However, this plan was formally terminated in October 2025. Compass cited a comprehensive consideration of internal and external objective environmental factors and its own strategic development goals as reasons for the termination.
Analysts point out that the termination of the 3 billion yuan placement temporarily closes the main channel for Maigao Securities' significant scale-up. Transitioning from a small regional broker to a competitively positioned mid-sized firm inevitably requires capital replenishment. Net capital serves as a hard constraint for all business expansions in the securities industry; without it, there are limits on margin trading scale, no market-making qualifications, and no voice in capital-intensive businesses.
Conversely, other perspectives suggest that while the termination disrupts Maigao Securities' capital expansion pace in the short term, slowing the rollout of capital-heavy services like margin trading, it may force a shift towards a lighter capital increase model using internal funds in the long run. This could signal a firm commitment to the securities business and the financial sector, while also avoiding excessive dilution of existing shareholder equity through a low-priced placement at a high stock price, thereby protecting the interests of minority investors to some extent.
The Long-Distance Race of the "Mini East Money"
Since acquiring Maigao Securities in 2022, Compass has been labeled a "mini East Money Information Co.,Ltd." (ASX: 300059). This label is not unfounded, as the growth trajectories of the two companies share similarities.
East Money Information Co.,Ltd. was founded in 2005, listed on the Shenzhen Stock Exchange's ChiNext board in 2010, and acquired Tibet Tongxin Securities in 2015. Through continuous traffic conversion and capital supplementation, it successfully transformed from a "software seller" to a "financial services provider."
Compass, founded in 1997 and listed on the ChiNext board in 2019, similarly aims to pursue a dual-engine strategy of "financial information services + securities business" after acquiring Maigao Securities in 2022, building a closed-loop internet brokerage ecosystem with fintech as its hallmark.
Furthermore, Compass is accelerating its efforts to complete its license portfolio. In March 2025, it completed a controlling acquisition of Pioneer Fund Management Co., Ltd., securing a 61.7% stake. This makes Compass one of the few listed companies holding both securities and fund licenses, mirroring East Money Information Co.,Ltd.'s structure with its securities and fund subsidiaries.
Regarding the Pioneer Fund acquisition, Compass stated that the fund business is a crucial component of its integrated strategic layout, serving as the foundation for providing inclusive finance to retail investors. Compared to securities firms' asset management products, public fund products have finer granularity, making diversified investment more accessible for small investors. Compass also values the product design and issuance capabilities of public funds, which can help materialize its years of accumulated quantitative analysis, strategy models, and technological expertise into concrete fund products, providing underlying support for its ultimate wealth management business.
However, beneath similar strategic frameworks lies a significant disparity in scale.
In 2025, Compass reported operating revenue of 2.146 billion yuan, a year-on-year increase of 40.39%, and net profit attributable to shareholders of 228 million yuan, up 118.74%. In contrast, East Money Information Co.,Ltd. achieved operating revenue of 16.068 billion yuan, a 38.46% increase, and net profit attributable to shareholders of 12.085 billion yuan, up 25.75%.
From a business perspective, software sales remain Compass's "cash cow." In 2025, financial information service revenue was 1.509 billion yuan, accounting for 70.32% of total revenue, with a remarkably high gross margin of 87.22%, nearing 90%.
However, the flip side of high margins is less impressive user traffic. Data shows that in 2025, the average monthly active users for Tonghuashun were 35.4991 million, for East Money Information Co.,Ltd. were 17.4277 million, for Dazhihui were 12.0955 million, while Compass had only 1.8446 million.
Compass is aware of this issue. In 2025, the company intensified brand promotion and client acquisition efforts, with sales expenses soaring to 1.111 billion yuan, a 38.09% increase year-on-year. Advertising and online promotion expenses alone reached 653 million yuan, up 67%.
On a positive note, Maigao Securities is growing rapidly.
In 2025, Maigao Securities achieved operating revenue of 757 million yuan, a 55.61% increase, and net profit attributable to shareholders of 165 million yuan, surging 133.36%. Specifically, net brokerage commission income was 487 million yuan, up 110.34%; net interest income was 101 million yuan, up 32.61%; and client settlement funds reached 10.115 billion yuan, a 52.72% increase from the end of 2024.
Starting from a near-zero base after the 2022 bankruptcy restructuring, Maigao Securities' recovery pace is notably fast. It turned profitable in 2023 with revenue of 207 million yuan and net profit of 5.93 million yuan. Revenue grew to 487 million yuan with net profit of 70.91 million yuan in 2024, and further increased to 757 million yuan in revenue with 165 million yuan in net profit in 2025.
Nevertheless, Maigao Securities' business licenses are not yet fully comprehensive. Currently, its investment banking sponsorship business and asset management business still require regulatory approval, while its margin trading business awaits license reissuance.
Analysts indicate that in securities industry performance rankings, margin trading interest income is the most elastic profit source during bull markets. The absence of this license directly caps Maigao Securities' valuation and business potential. It is suggested that the company prioritize obtaining the margin trading license while simultaneously preparing for the capital requirements once the license is secured.
In February 2024, in response to investor inquiries, Compass mentioned that its user profile, asset scale, and trading frequency are very similar to those of East Money Information Co.,Ltd., and it also focuses on brokerage and retail securities business as key future growth areas. However, the company acknowledged differences in scale, customer acquisition methods, and development timelines compared to East Money Information Co.,Ltd.. At that time, Compass expressed hope to gradually narrow the gap with East Money Information Co.,Ltd. within three to five years.
Compass's "East Money dream" is not a castle in the air. Strategically, the closed-loop path of "financial information service traffic conversion + securities business monetization" has been proven viable by East Money Information Co.,Ltd.. From a synergy perspective, Compass's paying users align well with Maigao Securities' brokerage business. In terms of license layout, the dual-license structure of securities and funds is already taking shape.
Yet, translating this dream into reality remains a long and challenging journey. Compass has spent over three years resurrecting Maigao Securities from the ruins of bankruptcy, achieving a leap from losses to a 165 million yuan profit—a report card worthy of recognition. However, to truly benchmark against East Money Information Co.,Ltd., Compass's 1.84 million monthly active users and 757 million yuan in securities revenue indicate that this race to catch up has only just begun.
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