Guosen Securities Performance Analysis and Investment Banking Business Risk Assessment Report

Based on the latest data and in-depth analysis, here is the full research report on Guosen Securities’ 87% net profit growth and investment banking business risks:

Guosen Securities recorded a net profit of RMB 9.137 billion in the first three quarters of 2025, with a year-on-year increase of 87.28%. This eye-catching figure brings its performance scale close to the full-year level of 2024 [1]. However, an in-depth analysis of the performance composition reveals significant structural concerns behind this growth.

From the perspective of revenue structure, Guosen Securities’ performance growth in the first three quarters of 2025 mainly relied on two core “engines”: investment income reached RMB 8.2 billion, surging 97.73% year-on-year, mainly driven by a sharp increase in investment income from financial instruments; net commission and fee income was RMB 7.708 billion, growing 71.92% year-on-year, of which net brokerage business commission income was RMB 6.362 billion, soaring 109.37% year-on-year [1]. The strong performance of these two businesses directly drove the rapid growth of overall net profit.

It should be noted, however, that this growth model has obvious cyclical characteristics. The increase in average daily trading volume in the A-share market, the rise in investor trading activity, and the asset revaluation trend triggered by technology stocks are all important factors driving the growth of proprietary trading and brokerage businesses. Once the market environment changes, this part of the income may face significant pressure.

In sharp contrast to the robust growth of proprietary trading and brokerage businesses, Guosen Securities’ investment banking business, once a core strength, has remained in a slump, becoming a drag on performance growth [1].

From 2021 to the first three quarters of 2025, Guosen Securities’ net commission income from investment banking business was RMB 1.979 billion, RMB 1.816 billion, RMB 1.363 billion, RMB 1.020 billion, and RMB 0.608 billion respectively, representing a cumulative decline of 48.46% over more than four years [1]. In the first three quarters of 2025, investment banking business revenue decreased 6.04% year-on-year, continuing the downward trend in recent years.

Data from Wind shows that the number of IPOs sponsored by Guosen Securities has been on a downward trend in the past three years, with 37, 19, and 16 cases in 2023, 2024, and 2025 respectively [1]. This data reflects the gradual weakening of the company’s competitiveness in the new share issuance market.

Against the backdrop of strict supervision over investment banking, Guosen Securities’ IPO withdrawal and rejection rate has shown an upward trend. In 2023, 7 projects were withdrawn, with a withdrawal and rejection rate of 21.62%; in 2024, 8 projects were withdrawn, with the rate rising to 42.11%; in 2025, 5 projects were voluntarily withdrawn, with a rate of 31.25% [1]. The high withdrawal and rejection rate not only affects the company’s market reputation but also indicates challenges in the quality control of investment banking projects.

Although the equity underwriting business has shrunk significantly, Guosen Securities still maintains certain competitiveness in bond underwriting. In the first half of 2025, the total principal underwriting amount reached RMB 104.345 billion, basically flat with the same period last year, and the company has made breakthroughs in innovative products such as sci-tech innovation bonds and green bonds [2]. This business has become one of the few bright spots in the investment banking segment.

While the company’s performance has surged, the intensive share reduction actions by important shareholders of Guosen Securities deserve high attention from investors [1].

On December 9, 2025, Guosen Securities disclosed a pre-disclosure announcement of share reduction by its seventh largest shareholder, FAW Equity Investment (Tianjin) Co., Ltd., which planned to reduce its holdings by no more than 22 million shares, accounting for 0.21% of the total share capital. As of December 26, this share reduction plan has been completed, and FAW Investment’s shareholding ratio has dropped to 0.89% [1].

At the same time, the second largest shareholder, China Resources Shenzhen International Trust Co., Ltd., restarted its share reduction plan after a four-year hiatus [1]. As an important strategic investor of the company, China Resources Trust’s decision to reduce holdings may reflect a certain reserved attitude towards the company’s future development prospects.

This phenomenon of “surging performance alongside shareholder share reductions” reflects institutional investors’ concerns about the sustainability of the company’s performance growth. Especially against the backdrop of continued pressure on the investment banking business, shareholders’ choice to reduce holdings and cash out may be a reassessment of the company’s long-term value.

It should be pointed out that the decline in Guosen Securities’ investment banking business is not an isolated case, but a common challenge faced by the entire securities industry [3].

In the first half of 2024, affected by the sharp contraction of market equity financing scale, the equity underwriting scale of securities firms plummeted. The equity underwriting scale was RMB 172.973 billion, a year-on-year decrease of 73.90%; among which, the IPO underwriting scale was RMB 32.493 billion, a year-on-year decrease of 84.50%; the refinancing underwriting scale was RMB 140.480 billion, a year-on-year decrease of 68.99% [3].

Against this backdrop, 43 listed securities firms achieved investment banking revenue of RMB 14.003 billion in the first half of 2024, a year-on-year decline of 41.07%. All top 10 listed securities firms in terms of investment banking revenue recorded declines to varying degrees, with CITIC Construction Investment, Haitong Securities, and CITIC Securities posting year-on-year declines of over 50% [3].

Guosen Securities’ investment banking revenue in the first half of 2024 recorded a year-on-year decline in the range of 40%-50% [4]. Although the decline narrowed in 2025, the overall downward trend remains difficult to reverse.

Based on the above analysis, the “quality” of Guosen Securities’ 87% net profit growth needs to be viewed dialectically:

• Proprietary trading and brokerage businesses achieved high-speed growth benefiting from improved market conditions
• Investment income performed strongly amid ample liquidity
• The transformation of wealth management business has achieved initial results, with steady growth in client asset scale

• The investment banking business continues to shrink, with core competitiveness being lost
• The number of IPO sponsorships and market share continue to decline
• Shareholders’ share reduction behavior may affect market confidence
• The income from proprietary trading is highly volatile, and its sustainability is questionable

1. Whether the investment banking business can find new growth drivers amid the deepening reform of the registration-based IPO system
2. Risk control capability of proprietary trading amid market fluctuations
3. Synergistic effects after integration with Wanhe Securities
4. Stability of shareholder structure and support from strategic investors

For investors, Guosen Securities’ “high-growth” financial report needs to be viewed rationally. Although the short-term performance is impressive, the business structural imbalance and the continuous decline of the investment banking business have cast a shadow over the company’s long-term development. It is recommended that investors, while paying attention to short-term returns, focus more on the company’s substantive progress in business transformation, risk control, and sustainable development.

Notably, against the backdrop of intensified competition in the securities industry and stricter supervision over investment banking, how Guosen Securities reshapes its investment banking competitiveness will become a key factor determining its long-term investment value.

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The following chart shows the performance change trend and investment banking business risks of Guosen Securities from 2020 to the first three quarters of 2025:

1. Net Profit Growth Trend Chart:
   Shows the net profit changes of Guosen Securities from 2020 to the first three quarters of 2025, reaching RMB 9.137 billion in the first three quarters of 2025, with a year-on-year growth of 87.28%
2. Investment Banking Business Decline Chart:
   Shows the continuous decline of net commission income from investment banking business from RMB 1.979 billion in 2021 to RMB 0.608 billion in the first three quarters of 2025, with a cumulative decline of 48.46%
3. IPO Sponsorship Volume and Withdrawal & Rejection Rate Chart:
   Reflects the trend of IPO sponsorship volume dropping from 37 to 16 cases in the past three years, while the withdrawal and rejection rate rose from 21.62% to 42.11%
4. Business Structure Change Chart:
   Compares the revenue scale and growth rate of each business segment in the first three quarters of 2025, with the investment banking business being the only declining segment

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[1] Sina Finance - “Shareholders Reduce Holdings While Guosen Securities Posts 87% Net Profit Growth: How High is the Quality of This Growth?” (https://finance.sina.cn/2026-01-17/detail-inhhrqrp4296593.d.html)

[2] Wall Street CN - “Guosen Securities: Net Profit Surges 71% in H1 2025, Driven by Explosive Growth in Investment and Trading Business” (https://wallstreetcn.com/articles/3754525)

[3] Guosen Securities Institute of Economics - “2024 H1 Mid-Year Report Review of the Securities Industry” (https://pdf.dfcfw.com/pdf/H3_AP202409121639844466_1.pdf)

[4] Securities Times - “Securities Firms’ Mid-Year Reports Released: Investment Banking Revenue Faces Universal Slump, Proprietary Trading Becomes the Key to Performance” (https://www.stcn.com/article/detail/1303550.html)