Core Viewpoint - Securities firms are optimistic about the industry outlook for 2026, focusing on valuation recovery and structural opportunities, with a shift in market drivers from valuation to earnings fundamentals [2][4]. Group 1: Industry Development Trends - The securities industry is expected to see core growth areas in wealth management, investment banking, internationalization, and technology empowerment [2]. - Wealth management is entering an upward trend, with strong new account openings and record-high financing balances, while A-share daily trading volume is projected to stabilize at 2 trillion yuan [2]. - The construction of product platforms is crucial for the transformation of wealth management, requiring alignment of product supply and sales channels [2]. Group 2: International Business Development - Developing international business is essential for securities firms to become leading investment banks, driven by increasing demand from overseas investors for Chinese assets [3]. - The international business revenue of securities firms has seen significant growth, with historical highs in the first half of 2025, supported by strong cross-border investment demand [3]. - The focus on AI technology applications and cross-border business will enhance service efficiency and asset pricing capabilities, helping to escape the homogenization of competition [3]. Group 3: Valuation Recovery Potential - The current valuation of the securities sector remains relatively low, with a projected net asset return of around 7.2% for 2026, indicating significant room for valuation recovery [4]. - The capital market is undergoing profound changes, with increased attractiveness of equity assets in a low-interest-rate environment, suggesting a positive development cycle ahead [4]. - Improved liquidity and favorable policies are expected to further enhance the valuation of securities stocks as the market improves [5]. Group 4: Investment Opportunities - The securities sector is anticipated to undergo a reshaping of its landscape, with a focus on leading firms with international capabilities and comprehensive service advantages [5]. - Mid-sized and large securities firms that can achieve leapfrog development through mergers and acquisitions are also expected to present investment opportunities [5].

Core Viewpoint - The securities industry is expected to see significant performance growth and a return to high value due to low valuations and potential expansion in ROE for leading brokerages by 2026 [1][2][6] Group 1: Market Performance - The A-share market has been on an upward trend, with the margin trading balance reaching 23,941.58 billion yuan and financing balance at 23,783.90 billion yuan by the end of Q3 [2] - In the first three quarters of 2025, listed brokerages achieved a net profit attributable to shareholders of 169.4 billion yuan, a year-on-year increase of 63% [2] - The average daily trading volume reached a historical high of 16.5 billion yuan, with total trading volume for the first three quarters amounting to 301.56 trillion yuan [2] Group 2: Business Growth Areas - Retail and international businesses are contributing new growth to the industry, with significant increases in new accounts and financing balances [3] - The investment banking market is recovering, and the derivatives business is expected to see regulatory improvements, enhancing overall performance [3] - The application of AI in the industry is progressing, with leading firms exploring innovative AI applications as a new growth point [3] Group 3: Valuation and Investment Opportunities - The securities sector is currently undervalued, with a PB ratio of 1.52, indicating potential for valuation recovery [4] - Analysts suggest that core businesses such as public funds, overseas operations, and investment banking will drive profitability improvements [4][5] - The industry is expected to benefit from liquidity improvements and favorable policies, with ROE projected to rise to 7.7% by 2026 [6]

Core Viewpoint - The securities industry is expected to see significant performance growth and a return to high value in 2026, driven by low current valuations and potential expansion in ROE for leading brokerages [1][2][4]. Market Performance - The A-share market has been on an upward trend, with the margin trading balance reaching 23,941.58 billion yuan and financing balance increasing by 5,242.45 billion yuan in the first three quarters of the year [1]. - The total trading volume of A-shares reached 301.56 trillion yuan, with an average daily trading volume of 16.5 trillion yuan, marking a historical high for the same period [1]. - Listed brokerages reported a net profit of 169.4 billion yuan in the first three quarters of 2025, a year-on-year increase of 63%, with a record quarterly net profit of 72.5 billion yuan in Q3 [1]. Business Growth - Key business segments such as brokerage, investment banking, asset management, interest income, and investment returns all experienced positive growth, with increases of 74%, 23%, 2%, 56%, and 43% respectively [1]. - Analysts highlight that retail and international businesses are contributing new growth to the industry [1]. Future Outlook - The industry ROE is projected to rise to around 7.2% by 2026, surpassing the 70th percentile since 2016, while the current industry valuation remains at the 40th percentile, indicating room for recovery [2]. - The trend of large wealth management and strong growth in new A-share and margin trading accounts is expected to continue, with daily trading volumes of 2 trillion yuan becoming the norm [2]. - The international business of Chinese brokerages is anticipated to expand, particularly in Hong Kong, with increased contributions from overseas branches [2]. Valuation Recovery - As of November 12, the PB ratio for the brokerage sector was 1.52, indicating a relatively low historical valuation [3]. - Analysts suggest that core businesses such as public funds, overseas operations, and derivatives are likely to drive profitability improvements, with a focus on strategic allocation opportunities [3]. - The current valuation of brokerages is seen as reasonable but on the lower side, with expectations for further increases as market conditions improve [3][4]. Investment Recommendations - Analysts recommend focusing on brokerages with advantages in overseas and institutional businesses, wealth management, and retail operations, particularly those benefiting from cross-border asset management trials in Hainan [3]. - The overall sentiment is positive regarding the securities industry's growth potential and value recovery opportunities leading into 2026 [4].