Zhongtai Securities Co., Ltd.: history, ownership, mission, how it works & makes money

Zhongtai Securities Co., Ltd., founded on May 15, 2001 in Jinan and listed on the Shanghai Stock Exchange as 600918.SS, has evolved from Qilu Securities (rebranded in 2014) into a state-backed financial group with roughly 8,771 employees by 2021, major shareholders including Zaozhuang Mining (32.62%), Laiwu Steel (15.00%), Shandong Hi‑Speed Investment (5.32%) and Xinwen Mining (3.47%)-all ultimately owned by the Shandong SASAC-while retaining a controlling footprint in subsidiaries (holding a 63.10% equity stake in one as of 2025); its mission centers on brokerage, investment banking and asset/wealth management underpinned by professionalism, integrity and risk controls, and its business model earns fees from brokerage and underwriting, management and advisory contracts, margin and securities‑lending interest, and proprietary trading; despite reputational headwinds after the 2022 arrest of former chief strategy analyst Chen Long (departure in November 2021), Zhongtai posted a trailing twelve‑month revenue of 12.29 billion yuan, a market capitalization of about 45.54 billion yuan in November 2025, and a Q3 2025 net profit attributable to shareholders of 589 million yuan (a 480.78% year‑over‑year rise), while expanding branch networks, wealth and asset management offerings, and technology investments to seize opportunities in China's capital markets.

Zhongtai Securities Co., Ltd. (600918.SS) - Intro

• Founded: May 15, 2001 (Jinan, Shandong)
• Shanghai Stock Exchange listing: 2001 - ticker 600918.SS
• Rebrand: 2014 (from Qilu Securities Co., Ltd.)
• Employees: ~8,771 (2021)
• Notable compliance event: Arrest of former analyst Chen Long (departed Nov 2021; incident reported 2022)

• Brokerage services: commissions and fees from retail and institutional trading on Chinese exchanges.
• Investment banking: underwriting and advisory fees from equity and debt capital markets transactions.
• Proprietary trading: trading gains and financing income from market-making and principal investments.
• Asset management and wealth management: management fees and performance fees from discretionary mandates and public/private funds.
• Research and securities lending: subscription and lending fees supporting trading and institutional clients.

Zhongtai Securities Co., Ltd. (600918.SS): History

• Founded and expanded through links with Shandong SOEs to support local capital markets and enterprise financing.
• Transitioned from regional brokerage to a diversified securities group offering institutional and retail services.
• Maintains a significant subsidiary portfolio - in 2025 it held a 63.10% equity interest in a key subsidiary, underscoring its integrated financial-services strategy.

• The combined holdings of the listed major shareholders are majority-controlled by Shandong State-owned Assets Supervision and Administration Commission (SASAC), making Shandong SASAC the ultimate controller.
• State ownership shapes strategic priorities: emphasis on supporting regional industrial clients, underwriting and M&A advisory for SOEs, and retail investor services to deepen local capital markets.
• Ownership has influenced risk appetite and capital allocation, with substantial equity stakes in subsidiaries to capture fee income and expand asset-management capabilities.

Zhongtai Securities Co., Ltd. (600918.SS): Ownership Structure

• Comprehensive services: securities brokerage, margin financing, investment banking, fixed income, wealth and asset management.
• Core values: professionalism, integrity, customer-centricity, innovation and robust risk management.
• Corporate social responsibility: community development programs and environmental sustainability initiatives integrated into business practices.

• Risk management: centralized risk-control systems, separate client asset custodial arrangements, and regular stress-testing of trading and lending exposures.
• Innovation focus: continuous product development (structured products, ETF services, digital wealth platforms) to meet evolving client needs.

• How it makes money:
  • Brokerage commissions and fees from retail and institutional trading.
  • Investment banking fees (ECM/ DCM, M&A advisory, IPO underwriting).
  • Asset and wealth management management fees and performance fees.
  • Proprietary trading and fixed-income market-making spreads.
  • Financing services: margin lending, securities lending and repo operations.

Zhongtai Securities Co., Ltd. (600918.SS): Mission and Values

• Zhongtai operates through a network of retail and institutional branches, regional subsidiaries and specialist business units to distribute products and deliver advisory services nationwide.
• Brokerage services: the company facilitates trading in A-shares, bonds, ETFs, derivatives and other instruments for both individual and institutional clients, monetizing through commissions, handling fees and order flow.
• Investment banking: underwriting and sponsorship for IPOs and bond issuance, plus M&A and restructuring advisory, receiving underwriting fees, arrangement fees and advisory retainers.
• Asset management: manages private funds, collective asset management products and public funds, generating management and performance fees from assets under management (AUM).
• Wealth management: provides tailored advisory, product allocation and financial planning for high-net-worth clients, earning advisory fees, product distribution margins and platform fees.
• Proprietary and trading operations: participates in market-making, proprietary trading and fixed-income/interbank operations, producing trading profits and interest income.
• Support and delivery: teams of analysts, traders, portfolio managers, underwriters, compliance officers and relationship managers support product development, risk control and client servicing.

• Transaction commissions and brokerage fees (retail and institutional).
• Underwriting and sponsorship fees from IPOs, debt issues and syndicated placements.
• Management and performance fees from proprietary funds, collective products and public funds.
• Advisory and retainer fees for M&A, restructuring and corporate finance projects.
• Interest income from margin financing, securities lending and proprietary asset holdings.
• Trading gains and market-making spreads across equities, fixed income and derivatives.

• Brokerage & commissions: meaningful base share, driven by retail turnover and institutional flow.
• Investment banking: high-margin but volatile, depends on IPO/bond market cycle.
• Asset & wealth management: recurring management/performance fees, growing with AUM.
• Proprietary trading & interest income: contributes to earnings volatility; enhanced by margin financing and securities lending.

• Retail clients: local branches and digital channels for trading, margin financing, and packaged wealth products.
• High-net-worth individuals: dedicated wealth management teams offering bespoke allocation and advisory services.
• Institutional clients: capital markets, custody, fixed-income and derivatives services delivered by specialized desks.
• Corporate clients: investment banking, corporate finance and treasury services via underwriting and advisory units.

• Risk controls: trade surveillance, counterparty credit limits, liquidity monitoring and stress testing to manage market, credit and operational risk.
• Compliance: licensing, regulatory reporting and KYC/AML frameworks aligned with CSRC and exchange rules.
• Talent base: research analysts, sales traders, product specialists and relationship managers are core to distribution, deal origination and client retention.

Zhongtai Securities Co., Ltd. (600918.SS): How It Works

• Brokerage: commissions and transaction fees on equities, bonds, futures and derivatives executed for retail and institutional clients.
• Investment banking (underwriting): fees from IPOs, follow-on equity, bond issuances and structured financing deals.
• Asset management: management and performance fees from public funds, private funds and discretionary mandates.
• Advisory: M&A, restructuring and strategic financial advisory fees charged on successful transaction closings.
• Margin financing & securities lending: interest income and financing spreads from margin loans and repo/securities lending facilities.
• Proprietary trading & market-making: P&L from firm capital deployed in equities, fixed income, derivatives and liquidity-providing activities.

• Fee-based vs. interest-based balance: brokerage, underwriting and advisory are fee-based and typically generate variable but high-margin income; margin financing, securities lending and proprietary trading produce interest and trading P&L with higher volatility.
• Leverage & capital allocation: margin lending and proprietary trading returns scale with allowed leverage and the firm's risk appetite subject to regulatory capital constraints.
• Market cycle sensitivity: equity market turnover and IPO windows materially affect brokerage and underwriting revenues; bond market activity drives fixed-income underwriting and trading revenues.

• Brokerage operations: order routing, execution, clearing and custody; digital platforms for retail clients plus institutional sales desks.
• Underwriting process: origination, due diligence, bookbuilding, pricing and distribution to institutional/retail investors; syndication reduces concentration risk.
• Asset management: fund product design, compliance, portfolio management teams, distribution via bank channels and independent financial advisors.
• Advisory workflow: sector teams, valuation and modelling, negotiation and transaction structuring; success fees payable on closing.
• Margin & securities financing: credit assessment, collateral management, margin calls, interest accrual and risk controls under regulatory limits.
• Proprietary desks: quantitative, macro and market-making desks using firm capital and hedging to manage inventory and market exposure.

• Transaction volume / value (daily/quarterly turnover) - primary driver of brokerage revenue.
• Number and size of ECM/DCM deals handled annually - drives underwriting fees.
• Assets under management (AUM) and net inflows - determine recurring management fees.
• Loan balance of margin financing and average lending rate - determines interest income.
• Risk-weighted assets and capital adequacy ratios - constrain proprietary/trading scale.
• Return on equity (ROE) and net profit margin - overall profitability measures.

Zhongtai Securities Co., Ltd. (600918.SS): How It Makes Money

• Brokerage services: commissions from retail and institutional trading, margin financing and securities lending.
• Investment banking: underwriting, IPOs, M&A advisory and bond issuances for corporates and SOEs.
• Asset & wealth management: management fees, performance fees, and product distribution to individual and institutional clients.
• Proprietary trading and principal investments: trading gains, structured products and inventory income.
• Research, advisory and other fees: paid research, investment advisory and custody services.