Overview of the 2026 interim reports of listed open source securities firms: profit structure is more important than growth rate, three major narratives support the revaluation of leading brokerage firms

The Zhitong Finance App learned that in the first half of 2026, 39 listed brokers' adjusted revenue and net profit after deduction were 356.2 billion yuan and 151.5 billion yuan respectively, +47% and +64%; leading brokerage firms withheld non-net profit +74% year-on-year, with an annualized weighted ROE average of 13.7%, leading in growth rate and profitability. The high profit growth of leading brokerage firms in this round not only benefited from the recovery in market sentiment, but also reflected the growth of big wealth management, international business, and investment in science and technology venture capital banks. Compared to the current growth rate, the bank places more importance on AUM fee revenue and profit sustainability brought about by customer demand business growth, while also focusing on the impact of investment income in science and innovation on single-quarter profits.

The main views of Open Source Securities are as follows:

The profit structure is more important than the growth rate. The three major narratives support the revaluation of leading brokerage firms

The high profit growth of leading brokerage firms in this round not only benefited from the recovery in market sentiment, but also reflected the growth of big wealth management, international business, and investment in science and technology venture capital banks. Product AUM accumulation brings continuous charges. Overseas customers need business expansion to drive scale and profit growth, and science and innovation project financing and project listing contribute underwriting revenue and investment income. Compared to the current growth rate, the bank places more importance on AUM fee revenue and profit sustainability brought about by customer demand business growth, while also focusing on the impact of investment income in science and innovation on single-quarter profits. Leading brokerage firms have a deep layout in the three main lines of business. The advantages obtained by customers and projects are expected to be further transformed into market share, combined with improved capital allocation efficiency and continued dividends, and they are optimistic about valuation repairs brought about by the rise in the ROE center.

I recommend CITIC Securities, GF Securities, Huatai Securities, CICC H, and Cathay Pacific Haitong. Among them, CITIC, Huatai, Guangfa, and CICC have multiple sources of growth and relatively strong profit sustainability; Cathay Pacific Haitong has both room for integration and flexibility in investment in science and innovation.

High profit growth in mid-term reports, outstanding performance in consignment sales and overseas business, and investment in science and innovation amplified profit flexibility

The adjusted revenue and net profit of 39 listed brokerage firms in the first half of 2026 were $356.2 billion and $151.5 billion respectively, +47% and +64% year-on-year; leading brokerage firms withheld non-net profit of +74% year-on-year, with an annualized weighted ROE average of 13.7%, leading in growth rate and profitability.

By business, consignment revenue was +85%. Early-stage holdings gradually contributed revenue, and the scale of product ownership and buyer investment continued to expand; overseas revenue was +70%, with customer business development and expansion driving profit growth; the recovery in domestic and foreign IPOs drove investment banks' net revenue +25% year over year, and leading brokerage firms +41% year over year, clearly superior to -1% of small and medium-sized brokerage firms. Most brokerage firms with direct investment in science and innovation are flexible. China Merchants, Cathay Pacific Haitong PE and Alternative subsidiaries contribute highly to profits. Huatai, GF, and CICC account is relatively low and there is little change over the previous year. The dependence of profit growth on this type of revenue is relatively limited.

Optimizing the business structure, increasing head share, and improving return on capital make up the three major narratives of brokerage investment

(1) The slow cow environment is conducive to customer asset accumulation, residents' wealth allocation, cross-border corporate financing, and the growth needs of science and innovation enterprises, and promotes the transformation of the three major businesses. Wealth management inventory fees and revenue growth from overseas customers enhance profit sustainability, and science and innovation projects accumulate contributions to underwriting, management and investment opportunities.

(2) Cross-border, OTC derivatives and integrated investment banking businesses require higher qualifications, capital, customer networks and expertise. Long-term investment by leading brokerage firms forms competitive barriers, which is expected to drive the concentration of incremental business at the head and transform it into a profit advantage through scale effects and comprehensive services.

(3) Compared with historical large allotments, some brokerage firms in this round supported overseas and cross-border business through H-share financing, and the capital investment was more clear; the medium-term cash dividend of listed brokerage firms was +45% compared to the same period, and the annual dividend policy was generally stable. The combination of prudent financing, improved capital allocation efficiency, and continuous dividends is conducive to more fully transforming profit growth into earnings per share and shareholder cash returns.

Risk warning: risk of market fluctuations and decline in trading activity; risk of investment banking business recovery and investment returns falling short of expectations; risk of wealth management transformation and asset management business growth falling short of expectations; risk of regulatory changes in cross-border and derivatives business.