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Business

CITIC Securities Q3 profit falls 20.2% as weak stock market hits investment income

China's CITIC Securities reported a 20.2% fall in third-quarter net profit to 7.68 billion yuan, missing analysts' estimates, as a weaker stock market cut its investment income.

By James Calloway · · 1 min read

China’s CITIC Securities reported a 20.2% fall in third-quarter net profit on Monday, missing analysts’ estimates, as a weaker stock market hit its investment income.

Net profit for the three months ended 30 September fell to 7.68 billion yuan, below the analysts’ mean estimate of 10.05 billion yuan compiled by LSEG, Reuters reported. The broker’s investment income fell 45.25% to 17.978 billion yuan in the first nine months of the year, as Chinese stocks declined amid a global selloff in AI-related stocks.

China’s broad blue-chip index, the CSI300, fell 12% during the third quarter, while Shanghai’s tech-focused STAR50 index declined 31%, according to Reuters.

The weaker investment result was partly offset by stronger fee income. Net fee income from the brokerage business rose 34.65% year on year to 14.73 billion yuan in the first nine months, while asset management income rose 24.86%. Investment banking fees and commissions rose 38.9% to 5.124 billion yuan in the nine months, amid what Reuters described as robust IPO momentum in mainland China and Hong Kong.

CITIC’s Hong Kong-listed shares closed down 0.56% at HK$21.12 before the earnings release, against a 0.51% rise in the benchmark Hang Seng index.

Reuters also reported that consolidation in China’s brokerage industry has accelerated this year as Beijing looks to build globally competitive investment banks and asset managers.

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