Grand Fortune Securities rating affirmed in Taiwan as profitability strengthens

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Grand Fortune Securities rating affirmed

Highlights

Fitch affirms Grand Fortune Securities' National Long-Term Rating at 'A-(twn)' with Stable Outlook, citing its equity underwriting niche and robust capital buffer.
TAIEX rises 59% and average daily equity turnover reaches 2.35 times 2025 levels in H1 2026, boosting sectorwide trading, brokerage, and underwriting income.
Grand Fortune Securities' annualised operating profit to average equity improves to 16.2% in H1 2026 from 5.6% in 2025, supported by stronger trading and equity issuance.

Rating action reflects underwriting position

As reported by Fitch Ratings, Taiwan-based Grand Fortune Securities Co., Ltd. has its National Long-Term Rating affirmed at 'A-(twn)' with a Stable Outlook, while its National Short-Term Rating remains at 'F1(twn)'. The agency says the assessment is supported by the firm's established niche in domestic equity underwriting, particularly for underserved small and medium-sized enterprises, and by a capital buffer that helps absorb market risk tied to underwriting positions.

Grand Fortune Securities operates as a boutique investment bank and, despite its relatively modest size, has built a leading position in Taiwan's equity underwriting market. Fitch says the firm's specialist model, execution record and deal pipeline allow it to compete with larger securities houses, including those linked to Taiwan's financial holding companies.

Market tailwinds offset by volatility risks

Fitch says investor appetite for AI-related investments is supporting trading activity, valuations and corporate financing demand in Taiwan's equity market. The agency notes that average daily equity turnover rises to 2.35 times its 2025 level in the first half of 2026, while the TAIEX climbs 59%, helping brokerage, trading and underwriting income across the sector.

At the same time, Fitch warns that high valuations and rising leverage leave securities firms more exposed to a sharp market correction. For Grand Fortune Securities, annualised operating profit to average equity improves to 16.2% in the first half of 2026 from 5.6% in 2025, helped by stronger brokerage and proprietary trading income as well as higher equity issuance, but earnings remain sensitive to capital-market sentiment.

Fitch also points to the firm's conservative capital structure, with net adjusted leverage at 2.2 times and a regulatory capital adequacy ratio of 397% at the end of the first half of 2026, well above the 150% minimum. Although Grand Fortune Securities relies on wholesale funding such as repo transactions for short-term liquidity, the agency says adequate liquidity coverage, high-quality collateral and lower leverage help support funding flexibility relative to mid-sized peers.

In our earlier coverage of the AI-linked tech stock selloff, we explained how hotter-than-expected U.S. inflation data revived rate-hike expectations and pushed Nasdaq-related futures and major AI names lower. We also noted investors’ growing concern that higher borrowing costs could make it harder to finance large-scale AI infrastructure spending, increasing volatility across equities.

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