The Zhitong Finance App learned that Cathay Pacific Haitong released a research report stating that it recommends leading brokerage firms with advantages over the entire business chain and stronger growth and sustainability in science and innovation investments. The huge short-term flexibility of floating profits is more cyclical, but in the medium to long term, leading brokerage firms that run in a closed loop of “investment-investment-banking-exit” and have proven their ability to obtain projects have room for revaluation in their science and innovation investment business.
Cathay Pacific Haitong's main views are as follows:
Since the second half of 2025, IPOs in the double innovation sector have gradually picked up, and first-level market science and technology innovation projects invested by brokerage firms in the early stages have concentrated into the cash out window, creating tens of billions of dollars in profit. This report attempts to answer two questions that the market is concerned about: 1. After some key projects are listed, how much profit flexibility can be released in the short term, and what is the pace of implementation? 2. In the medium to long term, is brokers' investment in science and innovation more cyclical or growth?
Perspective 1: In the short term, the flexibility that can be released by queued IPO projects is only expected to be equivalent to 5% of annual profit, and a few brokerage firms will benefit even more.
1) At the industry level. Excluding projects such as Changxin Technology, which have already been listed, the estimated after-tax profit of the brokers' participation in subsequent IPOs is only equivalent to 5% of the industry's annual net profit, which is a “profit increase” rather than a “profit restructuring.” 2) Company level. Fuying is concentrated on leading projects and leading brokerage firms rather than industry inclusiveness: for small and medium-sized brokerage firms, single project execution can leverage double-digit flexibility; leading brokerage firms can leverage double-digit flexibility; leading brokerage firms are more reflected in the strategic value of investment bank collaboration and project card positions, and performance delivery is smoother and more sustainable.
Perspective 2: Looking at the medium to long term, the growth of brokers' investment in science and innovation is yet to be tested over time. It should be understood that this round of floating profits is a product of a combination of cost depressions, systematic increases in valuations, and three-cycle dividends of issuing scarce premiums. All three may be difficult to replicate in new investments.
1) Yields are under pressure to return to average. The average yield on the first day of newly listed companies on the Double Innovation Board in '26 was 418%, far higher than 269% and 235% in '24 and '25, and far higher than the double-digit yield in 22-23; 2) Only a few brokerage firms have the ability to continuously invest in good projects, or rely on triple-investment linked business chain collaboration, or their own fund platform channels brought about by certain location advantages.
Perspective 3: Looking at overseas cases, Goldman Sachs's self-operated private equity investments are more cyclical, profits fluctuate greatly, and continue to reduce in-table exposure and shift to an off-balance sheet charging model. The review shows that net income from Goldman Sachs private equity can contribute nearly 30% of net profit in a bull market, and the beta attribute is extremely strong; over the past 10 years, Goldman Sachs reduced the size of private equity within the table by 94% and completely switched to off-balance sheet asset management; domestic brokerage firms continued to expand their alternative subscale, but it was difficult for profits to remain stable. Leading brokerage firms, like Goldman Sachs, have taken the initiative to reduce the scale, but the private equity sub-scale has not expanded significantly.
Risk warning: The pace of IPOs falls short of expectations; capital markets fluctuate greatly; listing progress of key projects falls short of expectations; there is a risk that the calculation model deviates from the actual situation.