The first half of 2026 proved to be a banner period for the brokerage industry, with parent-company-level operating revenue climbing 32% year-on-year and net profit jumping 23%. As upstream suppliers to this thriving sector, securities IT vendors displayed sharply contrasting results during the same period, with Hithink Royalflush Information Network Co.,Ltd. (ASX: Hithink Royalflush) securing the highest revenue and net profit, while Wealth Trend posted the lowest revenue and Winning Soft reported the weakest bottom line.

Notably, Hithink Royalflush's first-half net profit stood at 2.87 times the combined net profit of the other six securities IT firms covered in this review. In terms of growth momentum, Hithink Royalflush achieved the fastest revenue expansion, whereas Hundsun Technologies saw the steepest revenue decline. Meanwhile, Kingstar Technologies swung back to profitability with the largest profit surge, and DZH experienced the most significant drop in net profit.

Highest Sales Expense, Biggest Increase, and Top Expense Ratio

According to research from Soochow Securities, the securities IT sector can be divided into two main categories: C-end securities IT, which serves individual investors with market data software and value-added services, and B-end securities IT, which delivers trading systems and core business platforms to brokerages and asset managers. The C-end segment is anchored by companies like Hithink Royalflush, Wealth Trend (TDX), and DZH, which focus on market quotation software, maintenance, and trading system products. The B-end segment, represented by Hundsun Technologies, Kingstar Technologies, Vertex Software, Wealth Trend, and Winning Soft, provides complex systems such as centralized trading, asset management, and ultra-fast execution platforms.

China's financial IT market is currently navigating a confluence of stringent policy oversight and rapid technological change. Three primary forces—IT application innovation (Xinchuang), regulatory compliance, and artificial intelligence (AI)—are persistently driving institutional investment in IT infrastructure.

According to its interim report, Hithink Royalflush is a leading internet-based financial information service provider in China, generating revenue from value-added telecom services, software sales and maintenance, advertising and internet promotion, and fund distribution services. In the first half of 2026, the company reported operating revenue of 2.646 billion yuan, up 48.68% year-on-year, while net profit attributable to shareholders surged 89.76% to 952 million yuan. These figures firmly cemented Hithink Royalflush's position at the top of the pack for both revenue and profit.

However, the company also recorded the highest sales expense, the largest expense ratio, and the fastest expense growth among the seven firms analyzed. In H1 2026, Hithink Royalflush's sales expenses rose 75.36% year-on-year to 587 million yuan, with the sales expense ratio climbing 3.38 percentage points to 22.2%.

A closer look at the breakdown reveals that advertising and market promotion expenses jumped 145% year-on-year to 321 million yuan, underscoring the company's heavy reliance on marketing spend to drive customer acquisition and market share. Yet, this business structure has led some investors to question whether Hithink Royalflush is increasingly resembling an internet advertising firm. Indeed, advertising and internet promotion revenue reached 1.062 billion yuan in H1 2026, up 65.77% year-on-year—the fastest-growing of its four business segments—and accounted for 40.15% of total revenue, second only to value-added telecom services at 47.97%.

Worth noting is that the 75.36% surge in sales expenses outpaced the 48.68% revenue growth. Should capital market activity cool, these elevated selling costs could compress profit margins.

12.5 Billion Yuan in Cash Represents 87% of Total Assets: Is the Yield Too Low?

As of June 30, 2026, Hithink Royalflush held total assets of 14.308 billion yuan, of which monetary funds accounted for 12.449 billion yuan—approximately 87% of the total, nearing 90%. The vast majority of these funds were held as bank deposits, with no trading financial assets on the books. The H1-end cash balance declined 11.31% from 14.036 billion yuan at the end of 2025, likely due to cash dividend distributions.

During the first half, Hithink Royalflush generated 81 million yuan in interest income, plus 1 million yuan from fixed-term deposit interest and trading financial asset gains, bringing total broad-based interest to 82 million yuan. Calculated as "broad interest divided by average of beginning and ending monetary funds," the yield on this substantial cash pile was approximately 0.62% for the half year, or roughly 1.24% annualized. While this exceeds rates for demand deposits and one-year fixed deposits, with nearly 90% of assets—around 12.5 billion yuan—sitting in cash and virtually zero interest-bearing debt, one might ask whether the company could enhance capital efficiency by allocating a portion to more prudent wealth management products.

Directors and Major Shareholders Rush to Sell: Over 2.6 Billion Yuan Cashed Out in Under Two Years

On May 15, 2026, Hithink Royalflush announced that directors Wang Jin and Yu Haomiao, along with major shareholder Hangzhou Kaishishun Technology Co., Ltd. (Kaishishun) holding more than 5% of shares, intended to reduce their holdings by up to 4.065 million shares (0.54% of total share capital) within three months following 15 trading days, citing "shareholders' own capital needs." Specifically, Yu planned to sell 1.2195 million shares (0.16%), Wang 1.2195 million shares (0.16%), and Kaishishun 1.626 million shares (0.22%). By August 27, 2026, these three parties had collectively sold 4,065,000 shares at an average price of 222.22 yuan per share, cashing out a total of 900 million yuan.

Earlier, on September 29, 2025, Kaishishun had disposed of 699,100 shares at an average price of 359.50 yuan per share, netting 251 million yuan. At that price, the September 2025 sale appeared to coincide with a historical peak in Hithink Royalflush's share price. Between December 2 and December 30, 2024, Kaishishun completed a reduction of 2.688 million shares at an average price of 322.72 yuan, realizing 867 million yuan.

From December 23, 2024, to February 26, 2025, Ye Qiongjiu, the second-largest shareholder and current director and deputy general manager, sold a total of 2 million shares at an average price of 318.87 yuan, pocketing 638 million yuan. Over the span of one year and nine months, from December 2024 to August 2026, directors, senior executives, and major shareholders holding more than 5% of Hithink Royalflush collectively cashed out over 2.6 billion yuan.

On September 5, 2025, the company disclosed that its controlling shareholder, actual controller, and chairman Yi Zheng, along with Kaishishun (a shareholder with over 5% stake), intended to reduce up to 1.3831 million shares (0.26% of total capital). Based on that day's closing price of 361.5 yuan per share, this would have yielded approximately 500 million yuan, with Yi personally selling 684,000 shares for about 247 million yuan.

The primary controversy surrounding Yi's announcement was his stated rationale. The filing claimed the reduction was aimed at "optimizing personal resource allocation to focus more energy on the company's strategic layout and core business development," and that "through a moderate reduction, the aim is to cede market participation opportunities, release liquidity, activate market vitality, and create more favorable space for subsequent market value management." This explanation was widely ridiculed by investors as an "invitation to buy at the top."

At the time, Hithink Royalflush had 276 million shares in float, providing ample supply, so the notion of "ceding participation opportunities" seemed unfounded. On the first trading day following the announcement, the stock price fell accordingly. However, just one trading day later, on the early morning of September 9, the company issued an urgent notice stating that "due to various factors, Yi Zheng decided to terminate the reduction plan ahead of schedule." The gap between announcement and termination spanned a single trading day, leading investors to dub it a "one-day reduction."

Experts argue that such a swift reversal undermines the seriousness of information disclosure. More recently, Hithink Royalflush has also faced media scrutiny over product and service quality issues. According to a report by Haidai Finance of China Shandong Net titled "Investor Reports Hithink Royalflush's 'Financial Master' Service Fell Short of Promises, with Over 44,000 Yuan in Fees Still Unrefunded," an investor surnamed Yuan alleged that between April and May 2023, he was induced by sales staff through false advertising and oral promises of returns to pay a total of 80,300 yuan for investment advisory services. After finding the service content seriously diverged from promotional claims and suffered investment losses, he negotiated a partial refund of 36,000 yuan in March 2025, but the remaining 44,300 yuan has yet to be returned.

The same report cited another investor surnamed Li, who paid 80,010 yuan in December 2025 for the "Financial Master Supreme Edition" membership, only to discover after six months that "indicator data was tamperable and promotions did not match reality." Buy signals generated during trading hours were automatically erased when the market weakened, leaving only "hindsight signals" that offered no real-time guidance. Losses from trading based on this membership reportedly far exceeded those from self-directed trading. Following media coverage and repeated negotiations, Li received a full refund of 85,000 yuan from Hithink Royalflush.