Ant Acquisition Triggers Bull Market Leader! Securities Companies Underperform Shanghai-Shenzhen 300 Since 9/24

Author | Feng Jianhong

Editor | Jin Zixin

On March 17, Hong Kong stocks surged then pulled back, with the brokerage sector leading gains. CITIC Securities’ Hong Kong shares soared 3.75%, and GF Securities’ Hong Kong shares increased 3.56%. Meanwhile, major financial stocks in A-shares all advanced, and the Securities Index also rebounded, rising 1%.

Industry insiders analyze that this rally was driven by two major news events: first, capital fleeing the Middle East, prompting more funds to flow into Hong Kong; second, Ant Group’s acquisition of Hong Kong Yao Cai Securities was approved, causing Yao Cai Securities’ stock to surge by 82% at one point and boosting the sector.

Once the transaction is completed, Ant Group will hold licenses for securities, futures, asset management, and investment banking, evolving into a full-chain financial service provider.

Seeing the brokerage sector finally rise, netizens couldn’t help but comment, “Brokerages become ruthless when they rise, and neglect their own when they fall.” In stark contrast to the strong fundamentals of brokerages, the Securities Index has “kept falling,” with the Wind Securities Index down over 7% this year. Some industry experts believe that currently, the brokerage sector shows a pattern of “stellar performance, with valuations waiting to rise,” and now might be a rare window for strategic positioning.

Brokerage Performance Improves

According to performance forecasts disclosed by listed brokerages, the industry is expected to see significant growth in 2025.

As a leading industry player, CITIC Securities’ pre-disclosure data shows that in 2025, its net profit attributable to shareholders will surpass 30 billion yuan, a 38.46% increase year-over-year, with operating revenue reaching 74.83 billion yuan, up 28.75%.

Brokerages that have completed mergers also show growth potential after consolidation. Guolian Minsheng Securities expects net profit attributable to shareholders of 2.008 billion yuan in 2025, a 406% increase; Guotai Haitong also expects high growth, with net profit up 115% year-over-year.

Additionally, many brokerages like Huaxi Securities and Changjiang Securities have announced impressive forecasts, with net profit growth exceeding 100%.

In this regard, AVIC Securities’ research report points out that the performance of listed brokerages in 2025 will show a pattern of stable growth among top firms and emerging strength among small- and medium-sized ones. The core drivers of growth include three main aspects:

1. Improved market environment. Increased trading activity boosts commission income, while expanded margin financing and securities lending balances drive interest income growth.

2. Optimized business structure. Leading brokerages coordinate various business lines, while smaller firms focus on niche areas for transformation. Brokerage and proprietary trading have become the main growth engines.

3. Continued policy dividends. Active IPOs, refinancing, and M&A activities broaden profit channels. Increasing M&A deals have become a significant reason for some brokerages’ rapid performance growth.

Brokerage Performance Up, Stock Prices Not Following

Despite optimistic earnings forecasts for 2025, since 2026, the stock prices of brokerages have been relatively flat, exhibiting a “performance growth but stagnant stock prices” phenomenon.

CITIC Securities was the earliest to release earnings reports; from January 14 to March 17, its stock price declined over 7%.

Guolian Minsheng Securities’ stock price rose slightly by 0.93% after its earnings forecast, while Guotai Haitong’s stock fell more than 9% after its forecast.

As of March 17, the CSI Securities Company Index has fallen 7.88% year-to-date.

Looking back at the bullish atmosphere of 2025, the “bullish leader” brokerages also performed weakly. The Wind Securities Index’s increase last year was only 4%, far behind hot sectors like communications equipment and semiconductors, and underperforming the CSI 300.

Since the 2025 924 rally, the sector has underperformed the CSI 300. Wind data shows that as of March 17, the Wind Securities Index fell 7.59%, while the CSI 300 rose 2.6%.

Compared to historical bull markets, last year’s performance of the brokerage sector was somewhat abnormal.

During the major bull markets of 2006-2007 and 2014-2015, brokerage stocks often played the role of “leading vanguard,” with gains far exceeding the broader market.

For example, in November 2014, CITIC Securities surged over 155% in just two months, while the CSI 300 gained only 40%.

The Securities Index during 2014-2015 increased by 96%, and during 2006-2007, gains exceeded 1,000%.

Currently, the valuation levels of the brokerage index are low compared to historical levels.

Wind data shows that as of March 17, the industry’s forward P/E ratio is only 15.85 times, near the 6.65 percentile over the past decade. The price-to-book ratio is 1.37, around the 25.24 percentile in the last ten years.

According to Huaxi Securities’ analysis of public fund holdings in Q4 2025, the non-bank financial sector received increased holdings from public funds, with an increase ratio of 0.77%, ranking third among all sectors. Specifically, the securities sector remains underweighted.

Institutions: Valuations Are Highly Attractive

Recently, the “14th Five-Year Plan” explicitly clarified the development direction for financial institutions, which the market views as a key policy window for sector revaluation.

Guojin Securities notes that the operating environment for brokerages is further improving. Data from the Shanghai Stock Exchange shows that in January 2026, new A-share accounts reached 4.9158 million, an 89% increase month-over-month and a 213% increase year-over-year; daily trading volume of funds increased by 157% to 3.6 trillion yuan; daily margin financing balances rose 47% to 2.7 trillion yuan; IPO activities are returning to normal.

It is expected that ETF net outflows will ease, and the impact of refinancing will be manageable. The factors suppressing brokerages are gradually lifting, making current valuations highly attractive.

Shenwan Hongyuan analysts believe that 2026 is the start of the “14th Five-Year Plan,” and as the core intermediary of capital markets, brokerages are expected to benefit from a “Davis Double Play” driven by policies, funds, and market activity.

In terms of allocation, Huatai Securities recommends focusing on Hong Kong-listed brokerages with better valuations, leading domestic brokerages, and high-quality regional firms.

Moreover, brokerages are actively increasing holdings or buybacks, with companies like Huatai Securities, Hongta Securities, and Guo Investment Corporation announcing progress, signaling confidence to the market.

Note: Investment involves risks. Decisions should be made cautiously. This article does not constitute any investment advice.