Our reporter Zhou Shanghuan is a trainee reporter Yu Hong

Under the background that the policy encourages the securities industry to become better and stronger through mergers and acquisitions, the expectation of industry mergers and acquisitions is rising. Many securities companies plan to improve their comprehensive strength and core competitiveness through mergers and acquisitions. Recently, Zheshang Securities and Guolian Securities have taken frequent actions, and the process of related M&A and restructuring transactions is being actively promoted.

The enhancement of industry M&A and restructuring expectations also pushed the securities market higher. In the seven trading days from April 26 (the suspension date of Guolian Securities A shares) to May 9, five individual stocks rose more than 10%, of which one stock rose more than 30% accumulatively. Many analysts predict that industry mergers and acquisitions will boost the market of securities companies.

Continuous progress in mergers and acquisitions

At present, some securities companies have obvious expansion intentions, and industry M&A and restructuring are progressing constantly. On the evening of May 8, Zhejiang Merchants Securities announced that the board of directors agreed that the company would participate in the auction of 449 million shares (corresponding to 7.6933% shares) of Guodu Securities held by Guohua Energy Investment Co., Ltd. According to the website of Shanghai United Equity Exchange, the above-mentioned 449 million shares are being listed for transfer at a base price of 1.009 billion yuan, and the information disclosure time is from April 25, 2024 to May 23, 2024.

Zheshang Securities has a clear intention to become the largest shareholder of Guodu Securities and continue to increase its shareholding ratio. On March 29, Zheshang Securities announced that it planned to transfer 19.1454% shares of Guodu Securities held by five companies through agreement, and the price of share transfer was 2.673 yuan/share. Zheshang Securities said that this transaction is in line with the company's strategic plan, which is conducive to optimizing resource allocation, strengthening resource integration, further improving the influence and market competitiveness of the company's securities business, giving full play to the synergy between the company's existing business advantages and Guodu Securities business, and benefiting the interests of the company and investors.

Xu Yishan, chief financial analyst of Founder Securities, said: "Guodu Securities has 15.1% of its equity in public listing. If Zheshang Securities completes its acquisition, it will hold 34.25% of Guodu Securities in total."

In addition, the restructuring and integration of Guolian Securities and Minsheng Securities has entered a substantive stage. On the evening of May 7, Guolian Securities disclosed the latest developments. The company is planning to acquire the control right of Minsheng Securities by issuing A-shares and raise supporting funds. The trading of A-shares of the company has been suspended since the opening of the market on April 26; As of May 7, Guolian Securities and relevant parties are negotiating, demonstrating and confirming the restructuring plan; In view of the uncertainty of the related matters of this reorganization, the company's shares will continue to be suspended according to the relevant provisions of the Shanghai Stock Exchange.

As for the future development trend of the securities industry, Hu Xiang, the chief analyst of Soochow Securities Nonbank, said: "At present, the regulatory authorities clearly encourage the cultivation of first-class investment banks and investment institutions; as the Matthew effect of the industry intensifies, small and medium-sized securities firms may actively seek to be merged; the capital market is steadily opening up to the outside world, and leading securities firms face overseas competition. Under the above background, it is expected that a new round of industry M&A wave is coming. "

"We are optimistic about the synergistic effect of Guolian Securities' acquisition of Minsheng Securities and Zheshang Securities' acquisition of Guodu Securities, and focus on relevant structural opportunities," said Gao Chao, chief analyst of the non bank financial industry of Kaiyuan Securities.

Concern of related subject

Driven by the expected rise in industry M&A and restructuring, the recent rise in the securities sector ushered in a wave of market. Wind information data shows that as of the closing of May 9, A-share securities companies have risen 6.56% since the suspension of Guolian Securities on April 26.

In the above seven trading days, with the exception of the suspension of Guolian Securities, the rest 49 stocks of A-share brokerage sector all rose, and the 5 stocks all rose more than 10%. Among them, Guosheng Financial Holding rose 30.58%, ranking first; Capital Securities followed, up 16.51%; Pacific Securities, Zhejiang Merchants Securities and Cinda Securities all rose more than 10%, up 15.05%, 14.84% and 11.14% respectively; Dongxing Securities, CICC, Harbin Investment Group, China Galaxy, Founder Securities and Nanjing Securities all rose by more than 8%; A total of 27 stocks in the sector rose by more than 5%.

Individual stocks in some sectors rose continuously. Since the stock has risen or fallen for two consecutive trading days (April 26 and April 29), the Pacific released a stock trading risk warning announcement on April 29. Similarly, because the deviation value of the daily closing price rise of the stock in three consecutive trading days (April 26, April 29, and April 30) accumulatively reached 20%, on May 5, Guosheng Financial Holding released an announcement of abnormal fluctuations in stock trading.

Looking forward to the future trend of the brokerage sector, many analysts believe that the concept of mergers and acquisitions in the sector deserves attention, and relevant targets are expected to benefit.

Liu Jiawei, chief non bank analyst of Dongxing Securities, believes that "the innovation of business model of securities firms will open up imagination space for their profit growth. On the whole, M&A and restructuring are still the main investment line of the industry this year, and more optimistic about the investment opportunities of head institutions in medium and long-term innovative development and extensional M&A."

"M&A and restructuring will still be the main investment line of the securities industry in 2024." Yang Xiaotian, a non banking researcher of Hualong Securities, also believes that the head securities companies will become better and stronger through M&A and organizational innovation, while small and medium-sized securities companies will focus on differentiated development and featured operation.

On the whole, Shen Juan, chief analyst of Huatai Securities Finance, said: "Since this year, the capital market reform measures have been introduced one after another, and the market ecology has been continuously optimized. Wealth management and capital intermediary business are expected to gradually improve with the recovery of market sentiment; short-term performance of investment banking business is still under pressure, and new opportunities are expected in mergers and acquisitions; Further standardization of derivatives business is conducive to improving the stability of investment performance. "