The company's shareholding structure is diverse, and the majority shareholder, the entry of Beijing Guoguan, has brought new space. In May 2023, Beijing State-owned Capital Operation and Management Co., Ltd. (“Beijing State Management” for short) transferred 11.06% of the company's shares held by Pioneer Group through a non-disclosure agreement, becoming the company's largest shareholder. The diversified and decentralized equity structure gives the company the advantage of a mixed ownership enterprise, which helps the company maintain a flexible market-based management mechanism. In the future, the company will strengthen shareholder empowerment and strategic collaboration through Beijing State Management, the largest shareholder, and consolidate its business advantages.

“Fixed income+asset management” two-wheel drive to build institutional customer service capabilities. (1) Business opportunities: With the development of China's bond market, the diversified allocation of fixed income assets has become a growth point in the brokerage development model, and brokerage firms will expand various sources of income by serving institutional customers such as self-operated banks, financial management, and insurance. (2) Strategic orientation: The company adheres to the strategic direction of “becoming a securities company with fixed income characteristics and asset management business as the core”, and adheres to the position of “trading as the core, investment and sales as the two wings”, and enhances the depth of service to various institutions through sales business. Specifically, one is to maintain trading activity in the market, and the other is to focus on developing the FICC fixed income system to strengthen capital intermediation and valet business. The third is to develop asset management business and fund business, and build institutional customer trust through technology empowerment, etc. (3) Initial results in business construction: Asset management accounted for nearly 35% of revenue in 2018-2022, and as much as 48% in 2022; the fixed income business remained above 10% for a long time, accounting for 11% in 2022. In the first half of 2023, asset management and fixed income businesses accounted for 40% and 19% respectively. The company's “fixed income+asset management” business had outstanding advantages, which were significantly higher than those of its peers.

The Beijing Stock Exchange business is expected to grow twice. The Beijing Stock Exchange integrates IPOs, market making, trading, and direct investment businesses. Currently, the competitive pattern of the entire industry is undefined, and small and medium-sized brokerage firms have opportunities to grow. As the company's largest shareholder changes to the Beijing State Administration, a venture capital bank will, with shareholders' support, strengthen the reserves and issuance of Beijing Stock Exchange projects, focusing on various types of hard technology enterprises and innovative growth enterprises.

Profit forecast: The company's earnings per share for 2023-2025 are expected to be 0.11/0.14/0.15 yuan, net profit to mother is 4.59/5.91/645 million yuan respectively, and the net profit growth rate to mother is 14.6%/28.6%/9.2%, respectively. The reasonable valuation range for the next year is 6.04-6.58 yuan/share. Compared with the current stock price, there is 9.9%-19.6% premium space. In the context of a comprehensive registration system and wealth management, we have covered and given a “gain” rating for the first time.

Risk warning: risk of large fluctuations in the secondary market; risk of fixed income business being affected by macroeconomic factors; risk of asset management business facing changes in regulatory policies; risk of capital market deepening basic system reforms falling short of expectations; risk of large fluctuations in investment returns; risk of overseas regulatory risks.