CITIC Securities: The advantage of leading securities firms is further consolidated, focus on leading securities firms and medium-sized securities firms.

The research report from CITIC Securities indicates that in the first quarter of 2026, the non-GAAP attributable net profit of listed securities firms increased by 39.9% year-on-year, with non-GAAP ROE rising to 2.06%. The proportion of light and heavy capital business is both 46%, and the structure tends to be balanced. The advantages of leading securities firms have been further consolidated, with a non-GAAP ROE of 2.35% and a profit concentration ratio of 74.7%. Differentiation repair in various business lines: in the first quarter of 2026, asset management and net interest income surpassed the third quarter of 2025, brokerage and investment banking net income approached the level of the third quarter of 2025, and investment trading was affected by market volatility, but leading securities firms with deep non-directional layout showed stable performance; the optimization of management fee rates and the release of credit impairments jointly supported profit elasticity. International business is rising with the dual advantages of "high leverage + high ROE" and is expected to become a new growth engine for leading securities firms to cross the domestic cycle. It is recommended to layout along the two main lines of high certainty in performance and improvement in long-term competitive landscape: it is expected that the ROE of the securities industry in the year may reach the 90th percentile of nearly a decade, while the current PE and PB ratios are only below the 20th percentile, highlighting the value-for-money proposition. Pay attention to leading securities firms as well as medium-sized securities firms.