Asset management and proprietary trading both decline, why did the "old three" Huatai Securities fall behind?

On April 3rd, Huatai Securities’ stock price closed down 0.28%, at 17.67 yuan per share, with the latest total market value of 159.5 billion yuan. In fact, its stock price has been steadily declining this year, with a cumulative drop of over 25%. Investors on the stock forum are asking the secretary of the board about the reasons for the decline, and even questioning whether the company’s fundamentals have changed.

Currently, 25 listed brokerages have disclosed their 2025 annual reports. Against the backdrop of a market rebound, the industry as a whole has achieved relatively high growth, but Huatai Securities’ revenue and net profit growth rates are both less than 7%. In terms of segmented business, its asset management net income has fallen by over 50% year-on-year, and proprietary trading has also declined against the trend.

Due to weak performance and falling stock prices, a reporter from the International Finance News sent an interview letter to Huatai Securities, which has not been responded to as of the time of publication.

Falling Behind

Although Huatai Securities’ revenue and net profit still rank third in the industry, the gap with CITIC Securities and Guotai Haitong has become quite evident.

The reporter’s review shows that in 2025, Huatai Securities achieved a total revenue of 35.81 billion yuan and a net profit attributable to shareholders of 8B yuan, with growth rates of 6.83% and 6.72%, respectively, both lagging behind the industry. Looking back at 2024, its total revenue was close to that of second-place Guotai Haitong, and its net profit ranked second in the industry. By 2025, the top brokerage landscape has changed, and Huatai Securities has been noticeably overtaken by the second-place firm.

CITIC Securities’ total revenue increased by 28.8% year-on-year to 16.38B yuan, and its net profit attributable to shareholders grew by 38.58% to 74.85B yuan. In terms of segmented business, its brokerage net income rose 37.72% to 30.08B yuan, ranking second; investment banking net income increased 52.35% to 14.75B yuan, ranking first; asset management net income grew nearly 16% to 6.34B yuan, far ahead; proprietary trading net income rose 46.53% to 12.18B yuan, ranking first; and credit business net income increased over 50% to 1.63 billion yuan, ranking ninth.

Guotai Haitong, after the merger, posted impressive results, with total revenue up 87.4% year-on-year to 38.6B yuan, and net profit attributable to shareholders up 113.52% to 63.11B yuan. Among them, brokerage business jumped to first place; investment banking and asset management net incomes both ranked third; proprietary trading net income increased 72% to 27.81B yuan, far surpassing third place; and credit business surged 251% to 25.4B yuan, ranking first.

In contrast, Huatai Securities’ performance across business lines is mixed: brokerage net income increased 41.5% to 8.28B yuan, ranking fourth; investment banking net income rose 47.8% to 9.12B yuan, ranking fifth; asset management net income declined 56.64% to 3.1B yuan, dropping from third to fifth in the industry; proprietary trading net income decreased from 14.5 billion yuan in 2024 to 1.8B yuan, falling to fifth place; and credit business net income grew 62.52% to 4.4 billion yuan, slipping one rank to third.

An industry insider analyzed to the International Finance News that the “underlying currents” among leading brokerages reflect the true picture of the industry’s “Matthew effect” and “diverging development paths.” In a bullish market, each company’s performance reflects its strategic positioning and core competitiveness: CITIC Securities, with its comprehensive and stable internal strength, demonstrates strong anti-cyclical ability, continuously consolidating its position as the “all-round champion”; Guotai Haitong, through mergers, achieves scale effects and business synergy, with growth potential lying in deeper integration and establishing pricing power in capital-intensive businesses; while Huatai Securities’ slower growth exposes structural weaknesses in core businesses like asset management and proprietary trading.

How to Be Vigilant in Peace

CITIC Securities remains firmly in first place, Guotai Haitong is catching up strongly, and Huatai Securities, though holding third place, is only slightly behind the fourth. More critically, its growth rate is significantly lagging, and its advantages in asset management and proprietary trading are shrinking, with multiple business rankings declining.

An industry insider bluntly stated that Huatai Securities indeed needs to “be vigilant in times of peace.” Its challenges offer key lessons for the industry: under the trend of increasing industry concentration, relying solely on traditional channels or single advantages is unsustainable. Future development hinges on optimizing business structure, addressing weaknesses in proprietary trading and asset management, and firmly leveraging technology empowerment and institutional client advantages to transform into differentiated growth drivers in fintech, derivatives, cross-border business, and other fields, thereby reshaping competitiveness and avoiding falling behind in top-tier competition.

Chen Xingwen, Chief Strategy Officer of Heizi Capital, told the International Finance News that as competition among brokerages intensifies, the future trend of increasing industry concentration is irreversible. However, the securities industry is not a monotonous “big unified” pattern, but a vibrant ecosystem where three models—“large and comprehensive,” “specialized and refined,” and “multi-platform”—each shine and coexist.

First, the “large and comprehensive” top players will continue to serve as market stabilizers. Firms like CITIC Securities and Guotai Haitong, with their full licenses, deep balance sheets, and cross-market pricing power, will build insurmountable moats in institutional business, cross-border investment banking, and systemically important financial services. Their mission is to “stabilize”—stabilize market liquidity, policy transmission efficiency, and industry expectations. But their growth bottlenecks are also clear: decision-making delays caused by organizational complexity, ROE drag from capital-intensive businesses, and the “garden landscape” dilemma of innovation within a large system. Therefore, “big but not collapsing” must evolve into “big but not rigid,” through specialized subsidiaries, technological middle-office outputs, and cross-border collaboration mechanisms to activate organizational vitality.

Second, “specialized and refined” boutique brokerages will find fertile ground in gaps left by giants. Drawing on successful models like Jefferies in the U.S., focusing on small- and mid-cap investment banking and leveraged finance, or Switzerland’s Vontobel’s deep focus on thematic investments and boutique asset management, domestic regional brokerages can establish differentiated advantages in “local industries +特色品种.”

Third, “multi-platform” will be the ultimate form for mid-sized brokerages to break through, and the most disruptive variable. Platformization essentially involves “API-izing” license capabilities, providing infrastructure such as clearing, custody, risk control, and data, earning stable service fees rather than volatile risk exposure.

“For Huatai Securities, the key insight is to abandon a binary mindset. The three models are not mutually exclusive but complementary. The platform output of top institutions can empower boutique brokerages; their professional capabilities can enrich the platform ecosystem; and infrastructure platformization can reduce operational costs across the industry,” Chen Xingwen said. He believes that 2026 will be a year where “elephants dance” and “antelopes leap” together in the brokerage sector. The true wisdom in allocation lies in identifying core indicators for each model: for “large and comprehensive,” focus on capital efficiency and business synergy; for “specialized and refined,” focus on market share and customer stickiness; for “multi-platform,” focus on AUM growth and technological penetration.

Reporter: Zhu Denghua

Copyeditor: Chen Cai