East Wu Securities: Otorga calificación de compra a Founder Securities

Tings, Luo Yekang of Soochow Securities Co., Ltd. recently conducted research on Founder Securities and issued a research report titled “2025 Annual Report Review: Parent Net Profit Up 80% YoY, Brokerage and Proprietary Trading as Main Drivers,” granting a “Buy” rating to Founder Securities.

Founder Securities (601901)

Investment Highlights

Event: Founder Securities released its 2025 performance. In 2025, the company achieved operating revenue of 105.0 billion yuan, up 36.1% YoY; parent net profit of 3.97B yuan, up 79.9% YoY; EPS of 0.48 yuan; ROE of 8.0%, up 3.3 pct YoY. In Q4, operating revenue was 14.2 billion yuan, down 37.8% YoY and down 58.4% QoQ; parent net profit was 170M yuan, down 29.4% YoY and down 87.9% QoQ.

Brokerage business revenue rose significantly, and digital service capabilities continued to improve: 1）In 2025, the company’s brokerage business revenue was 55.8 billion yuan, up 38.2% YoY, accounting for 53.1% of operating revenue. The average daily trading value of stocks and funds across the whole market was 5.58B yuan, up 69.7% YoY. 2）The company’s margin lending balance was 557 billion yuan, up 34% from the beginning of the year; market share was 2.2%, flat vs. the beginning of the year. The total margin lending balance across the whole market was 2.54T yuan, up 36.3% vs. the beginning of the year. 3）The company built a matrix of digital intelligence tools to drive a leap in its service ecosystem. Both user activity and customer satisfaction of the Xiao Fang APP improved simultaneously: average daily active users on a yearly basis increased 12% YoY; average daily visit duration per user increased 15% YoY; customer satisfaction increased 6% YoY.

Investment banking business still needs improvement: 1）In 2025, the company’s investment banking revenue was 1.7 billion yuan, down 5.1% YoY. 2）Equity business underwriting scale increased 341.0% YoY to 11.0 billion yuan, ranking 39th; among them, 1 IPO with fund-raising size of 170M yuan; 1 refinancing with underwriting size of 3 billion yuan. As of the end of March 2026, the company has no IPO project reserves. 3）Bond lead underwriting scale decreased 0.4% YoY to 800M yuan, ranking 53rd; among them, underwriting scale for corporate bonds, ABS, and financial bonds was 300M yuan, 1B yuan, and 5 billion yuan, respectively.

Rapid growth in asset management scale: In 2025, the company’s asset management business revenue was 2.1 billion yuan, down 11.9% YoY. As of end-2025, the company’s assets under management were 500M yuan, up 64.3% YoY; Founder Fortune Fund’s AUM were 210M yuan, up 7.8% YoY.

Full-year investment returns grew strongly, with larger volatility in Q4: In 2025, the company’s investment returns (including fair value) were 21.1 billion yuan, up 48.7% YoY. In Q4, adjusted single-quarter net investment returns (including fair value, FX gains/losses, and other comprehensive income) were -4.7 billion yuan, turning from positive to negative on a YoY basis.

Earnings forecasts and investment rating: Combining the company’s 2025 operating performance, we raised our prior earnings forecasts. We expect the company’s parent net profit for 2026–2027 to be 44.38/47.23 billion yuan (previous values were 40.36/470M yuan), corresponding to YoY growth of +11.80%/+6.40%, respectively. We expect 2028 parent net profit to be 4.28B yuan, up 6.03%. On April 2, 2026, the company’s market value corresponds to PB valuations of 1.26x/1.13x/1.03x, respectively. We believe the company will gradually realize its wealth management advantages in an environment where market activity improves, and also further enhance competitiveness under deep empowerment from the Ping An Group. We maintain the “Buy” rating.

Risk warnings: 1）Decrease in market trading activity; 2）Stock market volatility impacting proprietary investment returns.

Latest earnings forecast details are as follows:

The above content has been compiled from publicly available information by Securities Star, generated by AI algorithms (ICP filing no. 310104345710301240019), and does not constitute investment advice.