Since the beginning of this year, Hong Kong's IPO financing has increased by over 200% year-on-year, and the market boom has led to tight investment banking capacity. Recently, international investment banks such as Goldman Sachs and JPMorgan, with their abundant project pipelines, have shifted from previous contraction strategies to restarting or accelerating talent recruitment plans, expanding their investment banking teams in Hong Kong, India, and other Asia-Pacific regions. Leading Chinese securities firms and some institutions like UBS, due to their integrated domestic and overseas investment banking operations, can deploy mainland investment banking talent, resulting in relatively more adequate staffing. Beyond investment banking business expansion, both Chinese and foreign securities firms are vigorously developing wealth management services to capture investment opportunities from the improving A-share and Hong Kong stock markets, meeting investors' cross-border asset allocation needs.
Year-to-date, Hong Kong's average daily turnover (ADT) reached HK$255 billion, representing a 93% increase compared to 2024's ADT. From the beginning of the year to date, 71 new companies have listed on the Hong Kong stock market, raising HK$187.3 billion through IPOs (compared to HK$88 billion raised through Hong Kong IPOs for the entire year of 2024). In Q3 2025, 25 new companies listed on the Hong Kong market, raising a combined HK$77.3 billion, up 83% year-on-year.
Shenwan Hongyuan Securities released a research report stating that it expects the securities sector's Q3 2025E net profit to continue the growth momentum of over 50% year-on-year from H1 2025, supported by increased market trading volume. From a market trading performance perspective, the daily average stock and fund trading volume in Shanghai, Shenzhen, and Beijing markets in Q3 2025 was RMB 2.04 trillion, up 153% year-on-year and 37% quarter-on-quarter. The daily average margin trading balance in Q3 2025 was RMB 2.12 trillion, up 49% year-on-year and 17% quarter-on-quarter.
In the Hong Kong stock market, year-to-date ADT reached HK$255 billion, up 93% compared to 2024's ADT. Year-to-date, 71 new companies have listed, raising HK$187.3 billion through IPOs (versus HK$88 billion for Hong Kong IPOs for the entire year of 2024). In Q3 2025, 25 new companies listed on the Hong Kong market, raising a combined HK$77.3 billion, up 83% year-on-year. Leading securities firms' overseas businesses are expected to maintain high growth.
Bank of America Securities released a research report stating that it expects Chinese securities firms' average net profit in Q3 2025 to grow 9% quarter-on-quarter and 21% year-on-year, supported by strong brokerage fee growth. Equity trading revenue may exceed expectations, driving overall performance. CICC (03908) and CSC (06066) are expected to lead peers, with Q3 net profit projected to grow 258% and 116% year-on-year, respectively.
Huatai Securities reaffirmed the strategic allocation opportunity for the securities sector, based on the resonance of multiple factors including policy, capital, performance, and valuation. Capital markets are undergoing profound top-down reforms, entering a new stage of coordinated investment and financing development. In a low interest rate environment, institutional and retail funds are accelerating their migration to equity markets, continuously bringing incremental capital. With market expansion and increased activity, securities firms' various businesses are reaching new levels, and profitability is steadily improving. However, sector valuations remain at relatively low levels. Huatai Securities believes now is a critical period to seize the strategic recovery opportunity for the securities sector.
Target selection focuses on: 1. Hong Kong stocks with better valuations and smaller free float; 2. A-share leaders with valuation cost-effectiveness; 3. Specialized small and medium-sized securities firms.
Related Chinese securities firms listed in Hong Kong include: CSC (06066), CICC (03908), GF SEC (01776), DFZQ (03958), EB SECURITIES (06178), CSC (06066), SWHY (06806), CC SECURITIES (01375), and GLMS SEC (01456).