# Industrial Securities (601377.SHG)

Canonical: https://gigainvestors.com/s/601377.SHG

Analysis as of: 2026-10-16T07:36:32.531Z. Financial observations: FY2007–FY2025.

Listing currency: CNY. Reporting currency: CNY.

## Verdict

Not a wonderful business

Quality tests for Buy: not passed (profit record: pass; earnings resilience is evidence only). Published buy qualification: no.

Share price: CNY 5.73 per share; close as of 2026-10-15.

Estimated value: low CNY 3.34 per share, central CNY 3.80 per share, high CNY 4.41 per share. Buy at or below the central value CNY 3.80 per share. Valuation as of 2026-10-16T07:36:32.531Z; scenarios are not confidence intervals.

Expected annual return: 7.6% at the stated quote. About 7.6% a year at today's price (required return 10.0%). required return 10.0% a year (10% floor; CN 10-year bond 1.7% + 4 points).

## Checklist

### understandable: fail

- 3 revenue declines in the last 10 years (informational)

- operating margin variation exceeds 0.35

- Financial history: 10 years

- Years with declining revenue: 3

- Years with a net loss: 0

- Operating margin variation: 0.39×

Chart: Operating margin; fiscal year observations.

- FY2016: 0.38×

- FY2017: 0.27×

- FY2018: 0.06×

- FY2019: 0.15×

- FY2020: 0.30×

- FY2021: 0.35×

- FY2022: 0.30×

- FY2023: 0.21×

- FY2024: 0.19×

- FY2025: 0.40×

### moat: fail

- Years with nonpositive invested capital use equity plus debt and leases; positive earnings with no positive capital are shown above 100%.

- ROIC median below threshold

- ROIC worst years below threshold (more than 1 bad year allowed)

- ROIC, median of available years: 7.4%

- ROIC, second-lowest year: 2.9%

- Typical minus recent gross margin: 1.2 pp

- Typical gross margin (annual median): 78.6%

- Recent gross margin (lower of latest and 3-year median): 77.4%

- Years with nonpositive capital: 2

- Capital spending / revenue: 2.3%

- ROIC including acquisitions, ten-year median: 9.2%

Chart: ROIC excluding acquisitions; fiscal year observations.

- FY2016: 9.3%

- FY2017: 5.2%

- FY2018: 1.5%

- FY2019: 11.7%

- FY2020: >100%

- FY2021: 5.6%

- FY2022: 2.9%

- FY2023: 43.5%

- FY2024: 28.1%

- FY2025: 3.0%

### economics: fail

- incremental invested capital return below threshold

- Owner earnings / net income, 5-yr: 1.07×

- Cash conversion uses consolidated totals: No

- Owner earnings, five-year total: CNY 15B

- Net income, five-year total: CNY 14B

- Return on incremental invested capital: 6.1%

- Working capital / revenue, annual change: -0.8 pp

- Working capital / revenue, change between three-year averages: -22.2 pp

- Working capital / revenue, final three-year average: -18.4%

Chart: Annual owner cash / profit; fiscal year observations.

- FY2021: 1.01×

- FY2022: 1.04×

- FY2023: 1.03×

- FY2024: 1.15×

- FY2025: 1.14×

### management: fail

- Historical market-dollar context (not the management verdict): 2016 to 2025 (9 years)

- buybacks unrelated to price (informational)

- ROIC first 3 years vs last 3 years: 5.2% vs 28.1%

- Per-share earnings: 0.34 to 0.25 (three-year endpoint medians)

- per-share value declined or ends nonpositive

- five-year and ten-year diluted share growth both above threshold

- Management verdict uses per-share economic progress: Yes

- Ordinary dilution, 10-year annual growth: 4.8%

- Ordinary dilution, 5-year annual growth: 5.2%

- Market cap gain: CNY 15B

- Cumulative retained earnings: CNY 4.9B

- Diluted shares, 10-year annual growth: 4.8%

- Diluted shares, 5-year annual growth: 5.2%

- $1 test, starting fiscal year: FY2016

- $1 test, ending fiscal year: FY2025

- Per-share value growth: -3.7%

- Per-share value change: CNY -0.09

- Per-share value, starting three-year median: CNY 0.34

- Per-share value, ending three-year median: CNY 0.25

- Buyback history: 0 years

- Debt-funded buybacks: No

- Acquisition spending: CNY 427M

- Cumulative net income, 10 years: CNY 25B

- ROIC, first three-year median: 5.2%

- ROIC, last three-year median: 28.1%

Chart: Earnings per share; fiscal year observations.

- FY2016: CNY 0.31

- FY2017: CNY 0.34

- FY2018: CNY 0.03

- FY2019: CNY 0.25

- FY2020: CNY 0.60

- FY2021: CNY 0.71

- FY2022: CNY 0.31

- FY2023: CNY 0.23

- FY2024: CNY 0.25

- FY2025: CNY 0.33

### accounting: pass

- latest-year receivables to sales index (DSRI) exceeds 1.465

- Sloan accruals: -7.3%

- Receivables to sales index (DSRI): 30.84×

- Restructuring years, last five: 0

- Stock compensation / operating cash flow: 0.0%

- Earnings backed by cash: Yes

- Operating cash / earnings: 9.80×

- Accounting red flags: 1

- Goodwill and intangibles / equity: 0.01×

Chart: Sloan accruals; fiscal year observations.

- FY2016: 25.1%

- FY2017: 15.6%

- FY2018: -11.3%

- FY2019: -9.7%

- FY2020: -2.0%

- FY2021: -4.8%

- FY2022: -8.1%

- FY2023: 4.5%

- FY2024: -7.3%

- FY2025: -7.3%

## Holders

## Price story

Down 40% since Dec 2021 · sales +14%

Story as of 2026-10-16T10:00:07.676Z; price observation 2026-10-15.

Price needs cash profits to grow 6.1% a year for ten years

### Sales · FY2024–2025

sales +14%; source https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/; observed 2026-10-16.

- FY2016: CNY 7.6B 

- FY2017: CNY 12B 

- FY2018: CNY 10B 

- FY2019: CNY 18B 

- FY2020: CNY 21B 

- FY2021: CNY 22B 

- FY2022: CNY 14B 

- FY2023: CNY 14B 

- FY2024: CNY 16B 

- FY2025: CNY 18B 

### Gross margin · FY2025

gross margin 79.8%; source https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/; observed 2026-10-16.

- FY2017: 72.8% 

- FY2018: 61.2% 

- FY2019: 80.5% 

- FY2020: 85.3% 

- FY2021: 86.4% 

- FY2022: 77.5% 

- FY2023: 75.6% 

- FY2024: 77.4% 

- FY2025: 79.8% 

## Owner memo

Memo as of 2026-10-16T08:06:05.509Z.

### How it makes money

Operates in capital markets; annual sales are CNY 18.2 billion.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:36:32.531Z); FY2025: revenue 18154423000; grossProfit 14479964000; margin = grossProfit / revenue.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16); 601377.SHG: Industrial Securities Co.,Ltd. operates as a securities company in China and internationally. It operates through Wealth Management Business, Institutional Services Business, and Proprietary Investment Business segments. The company provides securities and futures brokerage services, such as buying and selling stocks, funds, bonds, futures, options; sales of financial products; fund investment advisory services; margin trading; stock-pledged repurchase; and equity incentive financing. It also offers asset management, fund asset management, and private equity fund management services; securities research and sales trading services, asset custody and fund services, and institutional trading services; as well as equity financing, debt financing, financial advisory services, financing for small and medium-sized enterprises, and regional equity market services. In addition, it provides proprietary investment and trading of various products, including stocks, bonds, derivatives, equities, and alternative investments. The company was founded in 1991 and is headquartered in Fuzhou, China.

### Why customers stay

Margins ranged from 75.6% to 79.8% during 2023–25; it earns 7.4% on its capital.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:36:32.531Z); FY2023: grossProfit / revenue = 75.6%.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:36:32.531Z); FY2024: grossProfit / revenue = 77.4%.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:36:32.531Z); FY2025: grossProfit / revenue = 79.8%.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:36:32.531Z); 10-year return on capital observations [[2016,0.0930109757320921],[2017,0.052486178880974406],[2018,0.014685181610114681],[2019,0.11721602379343053],[2020,7.447073614770123],[2021,0.05586013392937344],[2022,0.029343433528205436],[2023,0.43460177220081536],[2024,0.28073764419974906],[2025,0.030293704935124573]]; median 0.07443555483073278. ROIC follows the displayed moat series; financial companies use return on tangible equity.

### Where the cash goes

Paid dividends in 10 of 10 years.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:36:32.531Z); FY2016: growth capex 0; upkeep 163223129.71; owner earnings 1982595602.29. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:36:32.531Z); FY2017: growth capex 100426401.53; upkeep 112231665; owner earnings 2284896126. Growth capex / owner earnings = 0.04395228316387806.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:36:32.531Z); FY2018: growth capex 0; upkeep 252698835.19; owner earnings 14682772.810000002. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:36:32.531Z); FY2019: growth capex 122405452.25999999; upkeep 160468177; owner earnings 1762537169. Growth capex / owner earnings = 0.06944843740767659.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:36:32.531Z); FY2020: growth capex 88325549.18; upkeep 209153784; owner earnings 4003314315. Growth capex / owner earnings = 0.022063106273982388.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:36:32.531Z); FY2021: growth capex 0; upkeep 530803285.71; owner earnings 4779111857.29. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:36:32.531Z); FY2022: growth capex 0; upkeep 577996548.74; owner earnings 2745373869.26. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:36:32.531Z); FY2023: growth capex 0; upkeep 704562891.92; owner earnings 2031092727.08. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:36:32.531Z); FY2024: growth capex 0; upkeep 451195407.6; owner earnings 2495773117.4. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:36:32.531Z); FY2025: growth capex 0; upkeep 315148000; owner earnings 3274871000. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:36:32.531Z); Dividend observations: [[2016,2308520827.9],[2017,3088940160.09],[2018,4193020476.13],[2019,3239124869.16],[2020,3009450274.45],[2021,3499069358.69],[2022,3388157791.59],[2023,2933306573.56],[2024,3334034827.6],[2025,1295398000]]. Zero only counted when supported by a complete cash-flow statement.

### Are managers owners

Insiders own 34.9% of the company.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16); 601377.SHG SharesStats.PercentInsiders = 34.919 percentage points; cache date 2026-10-16.

### What the price says

The price assumes cash profits grow 6.1% yearly over ten years; actual decline was 6.8%.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:36:32.531Z); Ten-year compound average after fade. Initial solved rate 0.07376786571964888. Price 5.73; FX 1; discount 0.1; same standard ten-year fade to terminal 0.03. FY2015 owner earnings/share 0.768584955298819 → FY2025 0.3792121139409272. Closing-price date 2026-10-15.

## Monthly share-price history (CNY per share)

- 2016-11: CNY 8.30 per share

- 2016-12: CNY 7.34 per share

- 2017-01: CNY 7.50 per share

- 2017-02: CNY 7.62 per share

- 2017-03: CNY 7.35 per share

- 2017-04: CNY 7.27 per share

- 2017-05: CNY 7.13 per share

- 2017-06: CNY 7.13 per share

- 2017-07: CNY 7.80 per share

- 2017-08: CNY 8.24 per share

- 2017-09: CNY 8.13 per share

- 2017-10: CNY 7.51 per share

- 2017-11: CNY 7.59 per share

- 2017-12: CNY 6.98 per share

- 2018-01: CNY 7.39 per share

- 2018-02: CNY 6.63 per share

- 2018-03: CNY 6.31 per share

- 2018-04: CNY 6.14 per share

- 2018-05: CNY 5.67 per share

- 2018-06: CNY 5.06 per share

- 2018-07: CNY 4.65 per share

- 2018-08: CNY 4.35 per share

- 2018-09: CNY 4.36 per share

- 2018-10: CNY 4.70 per share

- 2018-11: CNY 4.85 per share

- 2018-12: CNY 4.45 per share

- 2019-01: CNY 4.68 per share

- 2019-02: CNY 6.56 per share

- 2019-03: CNY 6.96 per share

- 2019-04: CNY 6.47 per share

- 2019-05: CNY 5.93 per share

- 2019-06: CNY 6.47 per share

- 2019-07: CNY 6.23 per share

- 2019-08: CNY 5.82 per share

- 2019-09: CNY 5.97 per share

- 2019-10: CNY 6.12 per share

- 2019-11: CNY 5.94 per share

- 2019-12: CNY 6.79 per share

- 2020-01: CNY 6.52 per share

- 2020-02: CNY 6.63 per share

- 2020-03: CNY 6.00 per share

- 2020-04: CNY 5.79 per share

- 2020-05: CNY 5.46 per share

- 2020-06: CNY 6.57 per share

- 2020-07: CNY 7.86 per share

- 2020-08: CNY 7.89 per share

- 2020-09: CNY 7.94 per share

- 2020-10: CNY 7.44 per share

- 2020-11: CNY 8.64 per share

- 2020-12: CNY 8.33 per share

- 2021-01: CNY 7.92 per share

- 2021-02: CNY 8.70 per share

- 2021-03: CNY 8.11 per share

- 2021-04: CNY 8.72 per share

- 2021-05: CNY 10.64 per share

- 2021-06: CNY 9.27 per share

- 2021-07: CNY 8.53 per share

- 2021-08: CNY 9.54 per share

- 2021-09: CNY 9.44 per share

- 2021-10: CNY 8.76 per share

- 2021-11: CNY 8.21 per share

- 2021-12: CNY 9.48 per share

- 2022-01: CNY 8.28 per share

- 2022-02: CNY 7.85 per share

- 2022-03: CNY 7.37 per share

- 2022-04: CNY 6.25 per share

- 2022-05: CNY 5.94 per share

- 2022-06: CNY 6.76 per share

- 2022-07: CNY 6.20 per share

- 2022-08: CNY 6.21 per share

- 2022-09: CNY 5.45 per share

- 2022-10: CNY 5.45 per share

- 2022-11: CNY 6.08 per share

- 2022-12: CNY 5.74 per share

- 2023-01: CNY 6.90 per share

- 2023-02: CNY 6.43 per share

- 2023-03: CNY 6.12 per share

- 2023-04: CNY 6.72 per share

- 2023-05: CNY 6.12 per share

- 2023-06: CNY 6.12 per share

- 2023-07: CNY 6.97 per share

- 2023-08: CNY 6.41 per share

- 2023-09: CNY 6.42 per share

- 2023-10: CNY 6.24 per share

- 2023-11: CNY 6.08 per share

- 2023-12: CNY 5.87 per share

- 2024-01: CNY 5.45 per share

- 2024-02: CNY 5.81 per share

- 2024-03: CNY 5.44 per share

- 2024-04: CNY 5.59 per share

- 2024-05: CNY 5.36 per share

- 2024-06: CNY 5.06 per share

- 2024-07: CNY 5.46 per share

- 2024-08: CNY 5.17 per share

- 2024-09: CNY 6.82 per share

- 2024-10: CNY 6.54 per share

- 2024-11: CNY 6.44 per share

- 2024-12: CNY 6.26 per share

- 2025-01: CNY 5.97 per share

- 2025-02: CNY 5.98 per share

- 2025-03: CNY 5.88 per share

- 2025-04: CNY 5.78 per share

- 2025-05: CNY 5.75 per share

- 2025-06: CNY 6.19 per share

- 2025-07: CNY 6.50 per share

- 2025-08: CNY 6.81 per share

- 2025-09: CNY 6.54 per share

- 2025-10: CNY 6.88 per share

- 2025-11: CNY 6.77 per share

- 2025-12: CNY 7.42 per share

- 2026-01: CNY 6.88 per share

- 2026-02: CNY 6.75 per share

- 2026-03: CNY 5.87 per share

- 2026-04: CNY 6.07 per share

- 2026-05: CNY 5.75 per share

- 2026-06: CNY 6.04 per share

- 2026-07: CNY 6.04 per share

- 2026-08: CNY 5.92 per share

- 2026-09: CNY 5.72 per share

- 2026-10: CNY 5.80 per share

## Annual estimated value (CNY per share)

- FY2016: low CNY 3.25 per share, central CNY 3.70 per share, high CNY 4.30 per share

- FY2017: low CNY 5.14 per share, central CNY 5.84 per share, high CNY 6.79 per share

- FY2018: low CNY 7.44 per share, central CNY 8.46 per share, high CNY 9.83 per share

- FY2019: low CNY 5.20 per share, central CNY 5.92 per share, high CNY 6.87 per share

- FY2020: low CNY 7.89 per share, central CNY 11.27 per share, high CNY 13.24 per share

- FY2021: low CNY 6.74 per share, central CNY 7.67 per share, high CNY 8.91 per share

- FY2022: low CNY 3.34 per share, central CNY 3.80 per share, high CNY 4.41 per share

- FY2023: low CNY 3.44 per share, central CNY 3.91 per share, high CNY 4.54 per share

- FY2024: low CNY 3.91 per share, central CNY 4.45 per share, high CNY 5.17 per share

- FY2025: low CNY 4.14 per share, central CNY 4.72 per share, high CNY 5.48 per share

Historical values use today's bond yield for every fiscal year

Historical values use today's FX rate into trading currency for every fiscal year

Historical values use current restated fundamentals and current commodity classification; they are not point-in-time estimates

## Sources

Estimates depend on assumptions and are not guarantees or investment advice. Underlying data remains subject to its source licenses; public reading does not grant bulk redistribution rights.

## Reported holder observations