Dongguan Securities updates its prospectus again. How are the new management's performance after a year in office? The IPO process awaits a breakthrough.

Ask AI · How does clarifying equity help accelerate the IPO process?

Cailian Press, April 2nd (Reporter Gao Yanyun) Dongguan Securities’ IPO process reaches a key milestone with updated financial reports.

On March 31st, Dongguan Securities, which plans to list on the Shenzhen Stock Exchange Main Board, updated its prospectus, mainly to reflect the latest financial data. The company’s 2025 revenue is projected at 3.39B yuan, a year-on-year increase of 22.99%; net profit attributable to shareholders is 1.25B yuan, up 34.89% year-on-year.

Dongguan Securities expects that in the first quarter of this year, total revenue will be between 861 million and 952 million yuan, a year-on-year increase of 26.62% to 39.95%; net profit attributable to shareholders will be between 331 million and 366 million yuan, up 63.06% to 80.23% year-on-year. The company states that, in the first quarter, the single-sided trading volume of stocks and funds in the Shanghai and Shenzhen markets increased significantly compared to the same period last year. The company expects that net income from brokerage commissions and interest income will grow compared to the same period last year.

Notably, Dongguan Securities, which previously ranked high in ROE, has reached a new level by 2025. By the end of 2025, the company’s weighted average return on net assets will be 12.29%, an increase of 2.35 percentage points from the previous year. In 2024, Dongguan Securities ranked among the top three in the industry with a 9.96% ROE, reflecting its profitability strength. This advantage is also reflected in the positive scoring in brokerage classification evaluations.

Since Yang Yang took office as General Manager of Dongguan Securities in February 2025, over a year has passed. The annual and first-quarter reports are essentially the results delivered by the new leadership team over the past year. As the company’s equity becomes clearer, governance structure improves, and the latest performance data are disclosed, it is worth watching when the IPO process will accelerate and come to fruition.

Brokerage contribution accounts for nearly 50% of revenue

Dongguan Securities has maintained growth over the past three years. From 2023 to 2025, the company’s revenue was 2.15B, 2.75B, and 3.39B yuan, respectively, with net profits attributable to shareholders of 635 million, 923 million, and 1.25B yuan.

Specifically, in various business segments, securities brokerage is currently the largest in scale and the main contributor to revenue and profit. In 2023, 2024, and 2025, the net income from agency securities trading commissions generated by Dongguan Securities was 897 million, 1.17B, and 1.64B yuan, accounting for 41.61%, 42.58%, and 48.42% of the company’s operating income during the same period.

At the same time, it is noteworthy that the net income from brokerage business increased significantly, with a year-on-year growth rate of 39.85% in 2025.

As Dongguan Securities’ primary source of revenue, brokerage business is also emphasized in the prospectus. The company mentions that brokerage accounts for a high proportion of its income. However, because brokerage is heavily influenced by market conditions, over-reliance on brokerage makes the company’s income structure less stable and less diversified.

Industry observations show that many brokerages rely primarily on brokerage income, including leading firms. Over years of industry development, brokerage has been the cornerstone of securities firms and the foundation for the rapid growth of wealth management and other businesses. How to better leverage strengths, expand wealth management based on brokerage, and make it a bigger and stronger business is a key challenge for Dongguan Securities.

Investment banking, however, has experienced a clear decline, becoming a performance weakness. In 2025, the net income from investment banking commissions decreased by 38.05% year-on-year. Specifically, in 2023, 2024, and 2025, the net income from investment banking was 199 million, 205 million, and 127 million yuan, respectively, accounting for 9.24%, 7.47%, and 3.75% of the company’s operating income, with a continuous decline in revenue contribution. Across the industry, investment banks are no longer enjoying the boom of IPO years. Both top-tier and small- and medium-sized firms are seeking new business breakthroughs.

Dongguan Securities’ proprietary trading income continues to grow, with a year-on-year increase of 10.66% in 2025. Specifically, in 2023, 2024, and 2025, the total revenue from proprietary trading was 295 million, 366 million, and 405 million yuan, respectively, accounting for 13.68%, 13.29%, and 11.97% of operating income, showing relatively stable contribution.

The company’s credit business grew in tandem with brokerage, with last year’s income increasing by 36.3% year-on-year. Specifically, in 2023, 2024, and 2025, the net interest income from credit business was 373 million, 427 million, and 582 million yuan, respectively, accounting for 17.32%, 15.51%, and 17.18% of operating income.

Dongguan Securities’ asset management business is relatively small, with a 47.5% decline last year. Specifically, in 2023, 2024, and 2025, net income from asset management was 58.92 million, 82.44 million, and 43.28 million yuan, respectively, accounting for 2.73%, 2.99%, and 1.28% of operating income. The sharp decline in asset management income is closely related to the maturity of large-scale products in 2025. How securities firms can differentiate their asset management strategies remains an important challenge, including for Dongguan Securities.

In terms of assets, as of the end of 2025, Dongguan Securities’ total assets were 79.55B yuan, net assets 10.5B yuan, and net capital 9.54 billion yuan, representing increases of 25.85%, 8.3%, and 1.58% year-on-year. The weighted average return on net assets was 12.29%, up 2.35 percentage points from the previous year.

The compensation of Dongguan Securities’ directors, supervisors, and senior management declined, with total salaries over the three years (2023-2025) being 27.77M, 25.18M, and 22.1717 million yuan, respectively, accounting for 3.81%, 2.27%, and 1.41% of profits.

Additionally, Dongguan Securities disclosed that from 2020 to 2025, the company has been rated as an A-level securities firm in the China Securities Regulatory Commission’s classification evaluation for six consecutive years.

Clearer equity + governance optimization, a key window for IPO after a 3-year delay?

Equity issues have long been a core obstacle in Dongguan Securities’ IPO process and a focus of market attention. According to regulatory requirements, IPO applicants must have clear, stable, dispute-free, or potentially dispute-free equity structures. Previously, Dongguan Securities’ private shareholders faced issues such as equity pledges and freezes.

The prospectus shows that the actual controller of Dongguan Securities is the Dongguan State-owned Assets Supervision and Administration Commission (SASAC). SASAC holds 75.4% of shares through three state-owned platforms: Dongguan Investment Holding Group, Dongguan Holdings, and Dongguan Investment Holding Capital. Yang Zhimiao and Zhu Fenglian hold a combined 24.6% through the listed company Jinlong Shares and New Century Science & Education.

As of the signing date of the prospectus, Jinlong Shares held 20% of Dongguan Securities, with 150 million shares pledged, accounting for 50% of its holdings; New Century Science & Education held 4.6%, with all 69 million shares frozen by judicial authorities.

Last June, private shareholder Jinlong Shares transferred its 20% stake in Dongguan Securities to the state-owned assets, leading to a reduction in board seats. In mid-March this year, Jinlong Shares and New Century Science & Education reduced their board seats from two to one, with President Yang Yang joining the board. Of the six non-independent directors, five are related to Dongguan SASAC.

Since Dongguan Securities’ IPO application was accepted in March 2023, there has been no substantial progress after three years of waiting. Now, with improved performance, clearer equity, and optimized governance, the market is closely watching whether this regional brokerage can break through and launch its IPO in 2026.