The Zhitong Finance App learned that J.P. Morgan Chase released a research report stating that it raised the target price of China Merchants Securities (06099) H shares from HK$20.5 to HK$21, maintaining the “increase in holdings” rating. The bank pointed out that before the third quarter results period, it was time for investors to re-examine China Merchants Securities. It believed that the stock was one of the few Chinese brokerage firms with a clear company-specific profit catalyst in the third quarter, yet most brokerage firms in the industry were still affected by weakening trading and the slowdown in financing activities in the third quarter.

The bank said that China Merchants Securities is the company with the highest investment exposure to Changxin Technology among Chinese brokerage firms, corresponding to an unrealized profit of about RMB 27 billion. However, the current stock price only reflects part of the value. As China Merchants Securities began to confirm related earnings after Changxin Technology's listing in July, the bank expects China Merchants Securities's third-quarter profit to increase by about 190% year-on-year and outperform its peers significantly. The bank believes that the recent decline in investment sentiment in technology stocks has narrowed the leading performance of China Merchants Securities compared to its July high, and currently provides attractive opportunities for gradual absorption until the third-quarter performance catalyst appears.

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