| Valuation method | Value, $ | Upside, % |
|---|---|---|
| Artificial intelligence (AI) | 40.84 | 158 |
| Intrinsic value (DCF) | 7.88 | -50 |
| Graham-Dodd Method | 8.68 | -45 |
| Graham Formula | n/a |
Yongan Futures Co., Ltd. is a prominent Chinese futures brokerage firm headquartered in Hangzhou, offering a comprehensive suite of financial services. Founded in 1992 and publicly traded on the Shanghai Stock Exchange, the company specializes in commodity and financial futures brokerage, serving clients both in China and internationally. Its business model extends beyond core brokerage to include wealth and asset management, fund sales, and futures investment consulting, positioning it as an integrated financial services provider in the capital markets sector. Operating in the world's largest derivatives market by volume, Yongan Futures leverages China's growing financialization and risk management needs of corporations and institutional investors. The company's established history and diverse service offerings make it a relevant player in China's expanding financial ecosystem, catering to the hedging and speculative demands of a rapidly developing economy.
Yongan Futures presents a mixed investment profile tied closely to the cyclicality of China's capital markets. With a market cap of approximately CNY 21.7 billion and revenue of CNY 21.9 billion, the company demonstrates significant scale in the Chinese futures industry. The diluted EPS of 0.4 and dividend per share of 0.12 indicate reasonable profitability and shareholder returns. However, the net income of CNY 575 million represents a relatively thin margin of approximately 2.6% on revenue, highlighting the competitive, volume-driven nature of the brokerage business. The company maintains a strong liquidity position with CNY 37.1 billion in cash against modest debt of CNY 1.5 billion, providing financial stability. The primary investment considerations are the company's sensitivity to trading volumes and market sentiment (beta of 0.976), regulatory changes in China's financial sector, and intense competition in the brokerage space. The attractive dividend yield must be weighed against the inherent volatility of revenue streams dependent on market activity.
Yongan Futures operates in China's highly competitive futures brokerage industry, where scale, technological capability, and service diversification are critical competitive advantages. The company's 30-year history provides established client relationships and operational experience, while its headquarters in Hangzhou—a major financial and technology hub—offers strategic positioning. Yongan's comprehensive service offering spanning brokerage, asset management, and investment consulting creates cross-selling opportunities and revenue diversification beyond pure transaction fees. However, the company faces intense competition from larger, state-owned brokers with greater capital bases and broader distribution networks. The industry is characterized by margin compression due to fierce price competition, necessitating continuous technology investments to maintain trading platform efficiency and client service quality. Yongan's international operations provide some geographic diversification but remain secondary to its domestic Chinese business. The company's competitive positioning is solid within the second tier of Chinese futures brokers, though it lacks the dominant market share of industry leaders. Future success will depend on its ability to differentiate through specialized services, technological innovation, and effective expansion of its asset management business alongside core brokerage operations.