Five securities firms have appeared in the list of shareholders of Changxin, with hundreds of billions in unrealized gains driving a reshuffling of the seating arrangement, creating a new "CMSC".

A stunning performance science and technology innovation board prospectus unveils a capital feast that has been brewing for years. In the latest prospectus of Changxin Technology, the shadow of five securities firms emerges: CMSC, Huaan, China Securities Co., Ltd., Founder, and CICC, through their subsidiaries or invested funds, had quietly laid out their plans several years ago. According to the latest valuation calculations, if Changxin Technology completes its IPO this year, the total book value of the equity held by these four securities firms (after deducting liquidity discounts) could reach as high as 32.7 billion yuan, equivalent to the annual net profit of many small and medium-sized securities firms. Among them, CMSC entered the game at the angel round, holding approximately 505 million shares, with a potential profit approaching 20 billion yuan. This investment is expected to propel its net profit for 2026 into the top three in the industry. Huaan, on the other hand, indirectly holds about 264 million shares, with a book value exceeding one billion yuan, nearly five times its net profit in 2025. The market performance driven by primary market equity investment by these securities firms may rewrite the industry's profit ranking. This once again proves that equity investment is a place where miracles are created and may also be the starting point for securities firms to unleash their imagination. Changxin Technology's estimated valuation is between 2 and 3 trillion yuan. The data in Changxin Technology's updated prospectus is explosive. The company expects revenue in the first half of the year to range from 110 to 120 billion yuan, an increase of 612.53% to 677.31% year-on-year. Net profit attributable to shareholders is estimated to be between 50 to 57 billion yuan, an increase of 2244.03% to 2544.19%. If this is linearly extrapolated, breaking the one trillion yuan net profit mark for the year is almost a certainty. Market estimates for its IPO valuation primarily use the Price-to-Earnings ratio. Based on the conservative estimate of a net profit of one trillion yuan, reference was made to the latest valuations of the three global DRAM giants: Samsung Electronics with a TTM P/E ratio of around 20.8 and SK Hynix with approximately 18.5. Taking into account Changxin Technology's premium position in the domestic market and the current average valuation level of around 94 times on the Science and Technology Innovation Board, analysts have provided two valuation anchors: a conservative estimate of a P/E ratio of 20, corresponding to a market value of around 2 trillion yuan; an optimistic estimate, which considers the domestic replacement attribute and a performance growth rate of over 2000%, giving a P/E ratio of 30 and a market value of 3 trillion yuan. For primary market financial investors, a lock-up period of 12 months exists, and the fair value at the end of the year needs to deduct liquidity discounts. The 1-year lock-up period can consider a 15% liquidity discount, resulting in a measurement of 85% of the market value of the shares held. The holdings path of the five securities firms emerges, with CMSC being the heaviest holder. Through layered and nested equity structures, the holdings and paths of the five securities firms with Changxin Technology become clear. CMSC was involved in the angel round financing stage of Changxin Technology, with a direct subscription through its wholly-owned subsidiary Zhaoding Investment, contributing 323.711 million yuan and holding 323.7136 million shares, representing 0.54% of the shares before the offering. Furthermore, CMSC's other wholly-owned subsidiary, Zhaoming Zhiyuan Capital, indirectly holds shares through two fund paths: first, holding 26.27% of Zhongan Zhaoming Fund, with the fund holding 467.9879 million shares, equivalent to 0.78%; second, holding 20% of Anhui Jiaokong Zhaoming Industrial Investment Fund, which holds 291.0879 million shares of Changxin Technology, representing 0.48% of the shares. After penetration calculation, CMSC indirectly holds approximately 504.87158 million shares of Changxin Technology, accounting for about 0.84% of the shares. Based on the valuation of 3 trillion yuan, the market value of the shares held by CMSC reaches as high as 22.646 billion yuan, with an end-of-term book value of approximately 19.249 billion yuan after deducting a 15% liquidity discount. This figure even surpasses CMSC's net profit of 12.3 billion yuan for the whole of 2025, meaning that the sole equity investment in Changxin Technology will create another "CMSC" on the books. Huaan achieves indirect holdings of Changxin Technology through two investment paths. We have already discussed in "Investing Five Hundred Million in Changxin, Boosting the Stock Price of This Securities Firm to Its Daily Limit, and Bringing Floating Profits to Create a Securities Firm's 'Performance Explosion'". The two paths combined, Huaan indirectly holds about 0.4391% of Changxin Technology shares, totaling approximately 263.9086 million shares. The market value of the holdings at a valuation of 3 trillion yuan is 11.838 billion yuan, with a book value of approximately 10.062 billion yuan after deducting the liquidity discount. This number is about five times Huaan's net profit of 2.111 billion yuan for the whole of 2025, making the significant impact on its profits. As the sponsoring institution for this IPO, China Securities Co., Ltd. appears as a shareholder through its wholly-owned subsidiary China Securities Co., Ltd. China Securities Co., Ltd. Investment holds 26.57% of Hefei Shuomuxinxin Xinyuan Rong Equity Investment Fund, which in turn holds 52.34% of SGX Negrant shares. After penetrating through multiple layers, China Securities Co., Ltd. indirectly holds a total of 0.15% of Changxin Technology shares, totaling about 88.96 million shares. The market value of the holdings is 3.99 billion yuan, with a book value of about 3.392 billion yuan after deducting the liquidity discount. In comparison, CICC holds a 0.02% share through its wholly-owned subsidiary China Golden Capital Operation serving as the executing partner of China Golden Mutual Benefit. China Golden Mutual Benefit directly holds 190.4198 million shares of Changxin Technology. Additionally, China Golden Capital holds a minimal amount of shares indirectly through multiple nested layers. The total holding percentage is about 0.00077%, totaling only about 81,000 shares, with a book value of approximately 0.03 billion yuan. Furthermore, Founder's subsidiary Fangzheng and Sheng Management's Hezhuang Fund directly invest 200 million yuan, through Heifei Xinxin Lirun Technology Partnership Enterprise (Limited Partnership) to invest 300 million yuan. CMSC is expected to enter the top three, while Huaan may move into the top ten. The floating profits from this equity investment significantly affect the profits of the securities firms, enough to change the industry rankings. Based on the 2025 net profit data for listed securities firms, CMSC ranks sixth with 12.318 billion yuan, CICC is in tenth place with 9.8 billion yuan, China Securities Co., Ltd. is in eleventh place with 9.454 billion yuan, and Huaan is in twenty-fourth place with 2.111 billion yuan. If a linear extrapolation of a 30% annual growth rate in net profit is considered, the estimated net profits for these four securities firms in 2026 are approximately: CMSC 16 billion yuan, CICC 12.7 billion yuan, China Securities Co., Ltd. 12.3 billion yuan, and Huaan 2.7 billion yuan. After adding the book profits from the Changxin Technology equity investment (after deducting the liquidity discount), the new net profit figures are astonishing. CMSC's net profit will reach approximately 35.2 billion yuan (16 billion plus 19.2 billion), not only far exceeding its original level but also propelling it directly into the top three in the industry. China Securities Co., Ltd.'s net profit will reach approximately 15.7 billion yuan (12.3 billion plus 3.4 billion), with a chance of a significant improvement in ranking. The most noticeable change is in Huaan: with a regular estimated net profit of 2.7 billion yuan plus a book profit of 10.62 billion yuan, the total is about 12.8 billion yuan. This means that Huaan has the potential to leap from a medium-sized securities firm ranked twenty-fourth into the top ten in the industry, competing with the long-established securities firms. After Changxin Technology, how many more similar "hidden" opportunities are quietly waiting to blossom? For these securities firms, equity investment is no longer just a secondary business for added bonus, but something that can change the industry rankings and open up new possibilities for their imaginations. This article is a translation from cailianshe.com, GMTEight editor: Chen Wenfang.