Investment Rating - The report maintains an "Accumulate" rating for the company [2][8]. Core Insights - The company has demonstrated stable core business operations, with a historical Return on Equity (ROE) outperforming comparable securities firms. The valuation has significantly increased due to the expectations of mixed operations in the securities industry and the State-owned Assets Supervision and Administration Commission's (SASAC) introduction of performance assessment metrics [5][7][19]. - The company is expected to benefit from capital market reforms and a high growth rate in client deposits, leading to a further increase in valuation [5][7][19]. - The company aims to leverage its shareholder background to enhance its business capabilities and establish itself as a top-tier investment bank [7][11][52]. Summary by Sections 1. PB Valuation Outperformance - Since the end of 2017, the company's Price-to-Book (PB) valuation has outperformed comparable securities firms, with an average valuation of 1.60X, which is 19% higher than its peers [19][21]. - The company's valuation is highly elastic, significantly influenced by policy catalysts, with historical peaks showing a 71% outperformance compared to peers [19][21]. 2. Leveraging Shareholder Synergies - The company is the largest securities firm under the SASAC, benefiting from the support of the China Merchants Group, which has substantial assets and a strong market position [52][55]. - The management team has extensive experience within the China Merchants Group, facilitating internal collaboration and enhancing operational efficiency [59][60]. 3. Business Characteristics and Profitability - The company exhibits a "large and stable" business model, with significant contributions from wealth management and institutional business, which are growing rapidly through both online and offline channels [7][30]. - The company has maintained a strong performance in brokerage and proprietary trading, with net income from these segments showing a compound annual growth rate (CAGR) of 6.3% and 19.8%, respectively, from 2017 to 2024 [25][30]. 4. Financial Data and Profit Forecast - The company forecasts revenues of 24,010.09 million in 2025, with a year-on-year growth rate of 14.93% [6]. - The projected net profit attributable to the parent company for 2025 is 11,680.68 million, reflecting a growth rate of 12.47% [6][8]. 5. Valuation and Investment Analysis - The report estimates a reasonable valuation of 1.44X PB for 2025, with expected net profits of 116.8 billion, 134.5 billion, and 151.9 billion for 2025-2027, respectively [8][49]. - The company is positioned to enhance its profitability through increased collaboration with its shareholder units, accelerating its development as a top-tier investment bank [7][8].