HUAXI Securities·2025-06-11 03:32Market Overview - The non-bank financial sector has seen a 28.69% increase from the "924" policy until the end of March 2025, outperforming the Shanghai Composite Index by 7.34% [3][12] - The sector's performance from April 1 to June 6, 2025, was a modest 0.32%, lagging behind the Shanghai Composite Index by 1.17% [3][12] - The non-bank financial sector's price-to-earnings ratio stands at 12.62 times, ranking 27th among primary industries, while the weighted price-to-book ratio is at 1.63 times, the lowest in the past decade [3][12] Performance Outlook - The "924" policy has stimulated market activity, with 38 comparable listed brokerages achieving adjusted revenues of CNY 415.1 billion and net profits of CNY 147 billion in 2024, reflecting year-on-year increases of 8% and 16% respectively [3][51] - In Q1 2025, these brokerages reported adjusted revenues of CNY 112.7 billion and net profits of CNY 51.9 billion, marking year-on-year increases of 34% and 81% [3][51] - The brokerage sector is expected to continue experiencing double-digit growth in 2025, supported by high growth in brokerage net income and proprietary trading net income [3][51] Policy Analysis - Since April 2025, the central bank and other authorities have actively signaled their commitment to stabilizing and invigorating the capital markets, which is expected to benefit non-bank financial institutions in the medium to long term [3][4] - A series of policies aimed at reducing liability costs are anticipated to support the insurance sector, although new business may face pressure [3][65] Investment Recommendations - For the brokerage sector, the report recommends focusing on firms with expected industry mergers and acquisitions, as well as those with strong retail brokerage and effective wealth management transformations, such as China Galaxy Securities, Huatai Securities, and Dongfang Wealth [3][4] - In the insurance sector, the report highlights opportunities driven by asset-side catalysts, recommending companies like New China Life, China Life, and China Pacific Insurance [3][4] Market Capital Flow - The average daily trading volume in China's stock market increased significantly, with a daily average of CNY 15.61 billion since the "924" policy, compared to CNY 7.746 billion prior to the policy [3][19] - New account openings surged, with 10.95 million new accounts opened in the first five months of 2025, a 30% year-on-year increase [3][22] - The insurance sector's investment in stocks and funds reached CNY 4.47 trillion, accounting for 13.3% of total insurance funds, reflecting a 24% year-on-year increase [3][41] Equity Supply - The number of IPOs in A-shares increased to 43 in the first five months of 2025, raising CNY 28.2 billion, which is a 13% year-on-year increase [3][45] - The report notes that the stock market is expected to see continued activity in equity financing, with a total of CNY 209.8 billion raised through equity financing in Q1 2025, a 51% increase year-on-year [3][45]