Shares of Guotai Haitong Securities Co., Ltd. (02611) rose more than 6% in trading.

At the time of writing, the stock was up 5.87%, trading at HK$14.42 with a turnover of HK$346 million.

Key Drivers Behind the Move

A report from JPMorgan has upgraded its rating on both the H-shares and A-shares of Guotai Haitong from "underweight" to "neutral."

The bank cited three primary reasons for this adjustment. Firstly, it views the company as a major beneficiary of the recent uptrend in the STAR Market.

Secondly, the brokerage sector's fundamentals are improving, supported by stronger average daily trading volumes and enhanced margin financing business in May.

Thirdly, while the recent underperformance has led to a valuation that appears reasonable, it is not yet compelling enough to warrant an "overweight" rating.

Future Growth Outlook

Based on current operating trends, projections indicate that Guotai Haitong's revenue and profit for the second quarter of 2026 could achieve year-on-year growth of approximately 64% and 140%, respectively.

This growth is expected to be driven by enhanced investment returns and a low base in the second quarter of 2025.

This momentum is anticipated to outpace that of its domestic securities industry peers and should provide support for the stock's near-term performance.