Investment Rating - The report rates the non-banking financial industry as "Overweight" [1][35]. Core Insights - The report highlights that the non-banking financial sector is experiencing a recovery, with significant growth in net profits for securities firms and insurance companies driven by improved market conditions and regulatory support [4][33]. - The report emphasizes the potential for mergers and acquisitions in the brokerage industry, particularly with the proposed merger of Xiangcai and Dazhihui, which could create new growth opportunities through a combination of traffic and licensing [4]. - The introduction of the "20 Articles on Pension Finance" by the financial regulatory authority is expected to enhance the development of the pension finance system, providing a solid foundation for the growth of listed insurance companies [4][33]. Market Overview - The non-banking financial index decreased by 0.1% last week, with the brokerage index down by 0.5% and the insurance index up by 0.6%, indicating a divergence in performance within the sector [4][8]. - The average daily trading volume in the stock market was 14,950 billion yuan, a decrease of 16.5% week-on-week, reflecting a slowdown in market activity [4][17]. Securities Industry Analysis - The securities industry is projected to achieve a net profit of 167.3 billion yuan in 2024, representing a year-on-year growth of 21.3%, driven by improvements in brokerage and asset management revenues [4]. - The report notes that 28 listed brokerages have reported a 15.3% increase in net profit, with a significant 96.6% growth in the fourth quarter, attributed to favorable market conditions following policy implementations [4]. Insurance Industry Analysis - The listed insurance companies are expected to report strong performance in 2024, with net profits significantly boosted by improvements in the equity market and enhanced product value rates due to regulatory changes [4]. - The report anticipates that the aging population will create opportunities for the development of pension finance, with measures aimed at improving financial services for the elderly [4]. Investment Recommendations - For the securities sector, the report suggests focusing on mergers and acquisitions, high asset returns, and improving return on equity (ROE), recommending investment in large, financially robust brokerages [4]. - In the insurance sector, the report advises attention to large comprehensive insurance companies that possess competitive advantages, particularly in light of new regulatory frameworks aimed at high-quality development [4].