First Capital Securities (002797 CH) Hold: Earnings exposed to fixed income volatility

Research evidence excerpt

First Capital Securities (002797 CH) Hold: Earnings exposed to fixed income volatility

12 May 2026

Equity Research Report

First Capital Securities EquitiesDiversified Financial Srvcs

(002797 CH)

Hold: Earnings exposed to fixed income volatility China

◆ We expect the brokerage business to remain a key pillar MAINTAIN HOLD

◆ We raise our 2026-27 net profit estimates by c32-42% and

TARGET PRICE (CNY) PREVIOUS TARGET (CNY)

introduce our 2028 earnings estimates

7.50 7.00

◆ Maintain Hold rating; raise TP to RMB7.50 (from RMB7.00)

SHARE PRICE (CNY) UPSIDE/DOWNSIDE

Rapid growth in key business; valuation likely to stabilise. First Capital Securities’ 7.85 -4.5%

share price has risen 14.3% YTD vs the CITIC Broker Index down 9.2% over the same (as of 11 May 2026)

period. The outperformance is supported by revenue and net profit growth fuelled by its MARKET DATA

higher proprietary investment returns amid a strong market, which is also in line with our Market cap (CNYm) 32,989 Free float 28%

previous expectations. We expect its investment and brokerage businesses to continue Market cap (USDm) 4,851 BBG 002797 CH

3m ADTV (USDm) 205 RIC 002797.SZ

to achieve higher returns riding on an active equity market and strong performance of

cyclical sectors, which should boost its overall earnings and thus support valuation. FINANCIALS AND RATIOS (CNY)

Year to 12/2025a 12/2026e 12/2027e 12/2028e

However, the stock is trading at 1.74x 2026e PB, a relatively high level among the HSBC QH EPS 0.20 0.32 0.39 0.47

brokers under our coverage; meanwhile, with asset management and fixed income HSBC QH EPS prev 0.21 0.24 0.28 na

Change (%) -6.3 31.9 41.6 na

businesses contributing c32% and c25% of total revenue, respectively, we think the Consensus EPS 0.22 0.24 0.26 0.27