Guosen Securities Co., Ltd.: Riding the Wave of a Resurgent Brokerage Landscape
Guosen Securities, listed on the Shenzhen Stock Exchange and a key player in China’s capital markets, closed the day before the market close at 14.04 CNH, comfortably positioned between a 52‑week high of 16.22 and a low of 9.23. With a market capitalization of 145.74 billion CNH and a price‑to‑earnings ratio of 14.93, the firm is trading in a valuation that reflects both its historical strength and the current upside potential in the brokerage sector.
1. Brokerage and Proprietary Trading: Dual Engines of Growth
The brokerage industry has shown a robust rebound in the third quarter, as disclosed by a comprehensive sector snapshot. 3,292 billion CNH of net income was generated by brokerage operations, up 74.64 % YoY. The sector’s momentum is further underscored by the fact that 70 % of total revenue now stems from brokerage and proprietary trading—Guosen’s two core businesses. In line with this trend, Guosen’s own proprietary trading arm reported a record‑setting 180 billion CNH of net profit in the quarter, signalling that its “bull‑flag” strategy is translating into tangible results.
2. ETF Business: A New Battleground
Active ETF management has become a cornerstone of wealth‑management services. By September, the Shanghai ETF market’s top two holders were Galaxy Securities and Shenwan Macom, together commanding nearly 40 % of total assets. Guosen, however, is carving out a niche by focusing on specialized, high‑quality ETFs that align with its proprietary research strengths. While it does not yet match Galaxy or Shenwan in scale, Guosen’s ETF portfolio is poised to benefit from the broader shift toward passive investment, especially as the firm’s research team continues to refine its selection process.
3. Market Outlook: Tech, Energy, and Hard‑Tech
The latest consensus among brokerage analysts—released on 1 November—projects a continued bullish market trend through November. Key sectors identified for growth include electronics, power equipment, and non‑ferrous metals, with a particular emphasis on “hard‑tech” and AI‑driven robotics. Guosen’s research division has flagged several high‑capability firms in these areas, and its proprietary trading desk has already increased exposure to a basket of these stocks. The firm’s positioning in these sectors positions it well to capture the upside that analysts predict.
4. Financial Health and Performance
Guosen’s robust financial footing is evidenced by its strong balance sheet and solid earnings growth. The company’s 2025‑Q3 operating income grew by 39.96 % YoY, and net profit rose to 25.21 billion CNH, a 9 % increase. These figures underscore the firm’s ability to generate high-margin revenue through both brokerage services and proprietary trading. Moreover, Guosen’s valuation—at a P/E of 14.93—remains attractive relative to its peers, many of whom are trading at premium multiples amid market volatility.
5. Strategic Initiatives
Guosen is actively pursuing two complementary strategies:
- Deepening Proprietary Trading – By leveraging its in‑house research and data analytics, the firm is expanding its proprietary positions in high‑growth sectors, particularly within the tech and energy spaces identified by market consensus.
- Enhancing ETF Offerings – Recognizing the shift toward passive investment, Guosen is developing a suite of thematic ETFs that tap into emerging trends such as AI, green energy, and semiconductor manufacturing.
These initiatives are expected to drive additional revenue streams and improve the firm’s competitive positioning against larger peers such as Galaxy Securities and Shenwan Macom.
6. Bottom Line
Guosen Securities is well‑placed to capitalize on the current bullish sentiment in China’s equity markets. With a solid track record in both brokerage and proprietary trading, an attractive valuation, and a forward‑looking strategy that aligns with sector dynamics, the firm represents a compelling investment thesis for investors seeking exposure to China’s capital‑market ecosystem.
In an environment where the brokerage industry is experiencing a surge in both revenue and profitability, Guosen’s disciplined approach to research, risk management, and product innovation should continue to deliver sustainable growth in the coming quarters.
