Dialogue with CITIC Securities' He Juying: Breaking the Traditional Sell-Side Model to Become a Financial Service Provider for the Entire Industry Lifecycle
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In recent years, with the changing environment of the capital market and the country’s strategic deployment in emerging industries, securities firms’ research business is undergoing a profound transformation. Shifting from traditional secondary market “sell-side research” to earlier-stage, more macro, and more practical “industry research” has become a consensus in the industry.
Against this backdrop, China Securities (CITIC Construction Investment) recently officially established the Future Industry and Policy Research Institute. As a brand-new first-level department, what role does it play within the company? Compared with other securities firms’ industry research institutes, what differentiated advantages does it have? Recently, Wallstreetcn conducted an in-depth interview with He Juying, Executive Director of CITIC Construction Investment Future Industry and Policy Research Institute, discussing the original intention behind its establishment, core positioning, and future plans.
Adapting to Change: Breaking Out of the Traditional Sell-side Framework
Talking about the original intention for establishing the research institute, He Juying candidly said that this move is deeply rooted in both internal and external causes.
“From an external perspective, traditional sell-side businesses face both opportunities and challenges. How to upgrade and transition the traditional model is a problem we must consider.” He Juying stated that establishing an industry research institute is an important measure to respond to external changes, and that they are actively exploring transformation into “financial service providers for the entire industry lifecycle.”
In terms of organizational structure, the newly established Industry Research Institute is a first-level department of the company, parallel to the traditional research institute, but with clear differentiation in business and clientele.
He Juying stated: The traditional research institute mainly handles secondary sell-side business, serving listed companies as well as secondary investors such as public funds and insurers; whereas the Industry Research Institute focuses more on early-stage companies prior to listing, and primarily serves the government, enterprises, primary market, and industrial investors.
Four-investment Linkage: Filling the “Early-stage Industry” Puzzle Piece
From an internal strategy perspective, the establishment of the CITIC Construction Investment Future Industry and Policy Research Institute is also a concrete step for the company to promote “four-investment linkage” (integration of research, investment, investment banking, and investment advisory).
The Institute focuses on in-depth research of emerging and future industries, striving to identify high-quality investment opportunities at an early stage, and working together with investment banking and investment departments to extend services from the secondary market to early industry stages, thus completing the puzzle of full-lifecycle services.
Core Positioning: Three Pillars Building a New “Industry-Finance Think Tank” Ecosystem
Currently, not only securities firms, but many financial institutions including banks, are setting up their own research institutes. How does the CITIC Construction Investment Future Industry and Policy Research Institute position itself? He Juying provided three core orientations:
First, to provide think tank services for the government. “We truly hope to have more opportunities to serve national strategies.” With years of experience in pharmaceutical industry research, He Juying deeply understands that comprehending national industrial strategies and regulatory approaches is critical for research work. In the future, the institute will not only actively undertake relevant research projects, but will also proactively study regulatory and guidance mechanisms for related industries, and actively make policy recommendations and participate in policy formulation.
Second, to provide strategic planning services for the company and group. Based on an in-depth understanding of national industrial policies, the institute will empower group and internal company strategy planning with a more professional and forward-looking perspective.
Third, to focus on “industry-finance integration.” In terms of integrating industry and finance, the institute already has clear initiatives. Recently, the institute has successively released “investment maps” for future industries such as hydrogen energy, embodied intelligence, and brain-computer interfaces, serving industrial investors and early-stage entrepreneurs. Leveraging these in-depth studies, the institute will continuously supply quality early-stage projects for the company’s “four-investment linkage.”
Reshaping the Structure: Targeting Four Major Research Directions
It is worth noting that in terms of staffing and research direction, the CITIC Construction Investment Future Industry and Policy Research Institute completely breaks the traditional sell-side’s custom of dividing teams by “industry” (such as consumer, cyclical, TMT, etc).
“After in-depth thinking, we anticipate that many future industries will not be limited to a single sector.” He Juying explained, after careful discussions, the institute has identified four main research directions:
1. Policy Research: Closely follows national strategy and deeply analyzes industry policy trends;
2. Industry Research: Focuses on emerging and future industries to extract the investment value of leading-edge sectors.
3. Regional Economy: As the “15th Five-Year Plan” is about to be implemented, local governments are also very concerned with the implementation of plans in their regions. The institute will ensure that industry research is truly grounded in regional economic realities.
4. Supply Chain Research: Against the current global macro backdrop, both the industrial and investment communities are concerned about supply chain security, which will also be a key research focus for the institute moving forward.
These four directions cover the core propositions of “development” and “security” during China’s current economic transformation period.
Differentiated Advantages: Making Industry Research “More Than Just on Paper”
With policy research institutes springing up across the industry, what is CITIC Construction Investment’s differentiated advantage?
He Juying modestly said that there are many excellent peers in the industry from whom they are learning, but CITIC Construction Investment has a clear approach of its own:
First is clear goals and focused directions. The three core objectives—think tank services, strategic services, and industry-finance integration—form a strong logical closed loop; the four research directions—policy, industry, regional economy, and supply chain—create a unique think tank brand.
More importantly is implementation capability based on platform advantages. “CITIC Construction Investment holds full licenses, with high industry standing in investment banking and related business areas. Relying on the company’s strong platform, our industry research will never remain just on paper,” He Juying emphasized.
Through the “four-investment linkage” mechanism, the institute will work together with the investment and investment banking departments to provide specialized financial services for technology companies throughout their lifecycle. At the same time, the institute will also host events such as the “Future Investment and Equity Investment Forum” to build a communication platform for all parties in the industry. The ability to directly transform research results into value for industrial clients is the core moat of the CITIC Construction Investment Future Industry and Policy Research Institute.
From interpreting macro policies, to taking the pulse of regional economies; from mapping future industries, to identifying early-stage opportunities, the CITIC Construction Investment Future Industry and Policy Research Institute is trying to break through the boundaries and definitions of traditional financial research. Such innovation will clearly open up another blue ocean for sell-side research.
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