Core Viewpoint - The significant discrepancies between the revenue figures reported in the Hong Kong IPO prospectus and the A-share annual reports of Shouchao Securities raise questions about the company's financial reporting and accounting practices [1][2][3][10]. Revenue Discrepancies - The total revenue disclosed in the Hong Kong IPO prospectus for 2022-2024 is 9.116 billion RMB, while the A-share annual reports show a total of 5.933 billion RMB, resulting in a difference of 3.183 billion RMB, which is a discrepancy ratio of over one-third [1][2][3]. - For the first half of 2025, the revenue figures also show a significant difference, with the Hong Kong prospectus reporting 1.855 billion RMB compared to 1.284 billion RMB in the A-share report, a difference of 571 million RMB [3]. Business Dependency - Shouchao Securities heavily relies on investment business income, with investment revenue accounting for 26.9% to 51.8% of total revenue from 2022 to the first half of 2025 [11][12]. - The company's asset management business has seen a substantial decline, with a reported revenue drop of 54.06% in the first half of 2025 compared to the previous year [16]. Competitive Position - Shouchao Securities ranks 38th among 42 listed securities firms in terms of revenue, indicating a small scale and lack of competitive differentiation [13]. - The firm faces challenges in establishing a unique competitive advantage due to its heavy reliance on self-operated investment business, which is highly influenced by market conditions [11][13]. Wealth Management Performance - The wealth management division has consistently reported negative profits for two and a half years, with revenues failing to surpass previous highs [17][18]. - The wealth management revenue for 2022-2024 and the first half of 2025 shows a downward trend, with profits turning negative in recent years [18]. IPO Rationale - The rationale behind Shouchao Securities' decision to pursue a Hong Kong IPO shortly after its A-share listing includes enhancing capital strength and competitiveness, as well as better integration of international resources [19].

Core Viewpoint - The article discusses the upcoming IPO of Shouchuang Securities on the Hong Kong Stock Exchange, highlighting its strategic focus on asset management and technology investments, aiming to enhance its core business and international presence [1][2][7]. Fundraising and Business Focus - Shouchuang Securities plans to use the funds raised from the IPO primarily for asset management, investment banking, and IT investments, with a focus on enhancing its core business and financial technology capabilities [2][3]. - The company aims to solidify its asset management business, which is crucial for its development, and diversify its investment banking operations [2][3]. Financial Performance and Growth - From 2022 to 2024, Shouchuang Securities' revenue is projected to grow from 1.588 billion to 2.418 billion, with net profit increasing from 555 million to 985 million [3]. - The average return on total assets is expected to rise from 1.5% in 2022 to 2.2% in 2024, with the weighted average return on net assets increasing from 5.4% to 7.6% during the same period [3]. Asset Management Business Insights - The asset management business plays a significant role in Shouchuang Securities, contributing 37.61% of total revenue in 2024, while investment business accounts for 44.09% [4]. - The company has achieved a compound annual growth rate of 15.8% in asset management scale from 2022 to 2024, contrasting with the industry average decline of 6.7% [4]. Recent Challenges - In the first half of 2025, Shouchuang Securities experienced a decline in asset management revenue, which accounted for 19.74% of total revenue, down 54.06% year-on-year due to market conditions [5]. - Despite the revenue drop, the company continues to see steady growth in asset management scale [5]. Shareholding Changes - On October 15, 2023, Shouchuang Securities announced a transfer of 3.56% of its shares from its controlling shareholder to Beijing Infrastructure Investment Co., which will enhance business support for Shouchuang Securities [6]. Internationalization Strategy - The IPO is part of Shouchuang Securities' strategy to strengthen its capital base and support international business expansion, focusing on global service capabilities and partnerships with overseas financial institutions [7][8].

Core Viewpoint - Shouchuang Securities Co., Ltd. has submitted an application for listing on the Hong Kong Stock Exchange, with several major securities firms acting as joint sponsors [1]. Company Overview - Shouchuang Securities is recognized for its leading value creation capabilities and outstanding asset management, focusing on differentiated financial services [3]. - The company operates a one-stop financial service platform based in Beijing, serving a diverse and steadily growing client base [3]. - According to Frost & Sullivan, from 2022 to 2024, Shouchuang Securities ranks fifth and tenth among 42 A-share listed securities companies in China for revenue and net profit compound annual growth rates, respectively [3]. - In 2024, the company is projected to rank first in average total asset return on equity and seventh in weighted average net asset return among the aforementioned A-share listed companies [3]. Business Segments - The company engages in four main business categories: - **Asset Management**: Includes asset management services, private equity fund operations, and public fund operations through joint ventures [4]. - **Investment**: Comprises fixed income trading, equity securities investment, New Third Board market making, and alternative investments [4]. - **Investment Banking**: Encompasses bond underwriting, stock sponsorship and underwriting, and financial advisory services [4]. - **Wealth Management**: Covers securities brokerage, investment consulting, financial product sales, credit services, research services, and futures business [4]. Financial Performance - For the six months ending June 30, 2022, 2023, 2024, and 2025, the company reported total revenues of approximately RMB 2.519 billion, RMB 2.970 billion, RMB 3.588 billion, and RMB 1.845 billion, respectively [5]. - Corresponding net profits for the same periods were approximately RMB 555 million, RMB 701 million, RMB 985 million, and RMB 490 million [5]. - The company has maintained robust profit growth and a scientific capital operation strategy, consistently implementing high cash dividend ratios to ensure long-term stable returns for shareholders [4].

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