Core Viewpoint - The Hong Kong Stock Exchange (HKEX) and the fully-owned subsidiary of the Exchange Fund, Clearstream, signed a memorandum of understanding to optimize post-trade securities infrastructure in Hong Kong's capital market, supporting the long-term development of fixed income and currency products [1] Group 1 - The collaboration aims to enhance efficiency across asset classes, including equities and fixed income, expand the use of mainland bonds as collateral, and strengthen Hong Kong's position as a bond issuance center [1] - The agreement is seen as a significant milestone, with both parties committed to supporting the development of Hong Kong's capital market by providing a richer array of products covering more asset classes [1] - The CEO of HKEX emphasized the strategic commitment to building a vibrant, world-leading ecosystem for fixed income and currency products in Hong Kong, hoping to advance the development of the fixed income market and the internationalization of the Renminbi [1]

香港交易所集团行政总裁陈翊庭最新发声。 3月4日，陈翊庭发表最新网志，阐述香港在发展固定收益和货币市场的新里程和新机遇。陈翊庭表示，不久前，她和香港交易所的同事们赴瑞士达沃斯参加 了世界经济论坛，在那里不仅聆听全球智慧，也向世界讲述香港故事。 对此，陈翊庭表示，固定收益和货币（FIC）市场将是重点拓展的领域之一。"经过多年的发展，我们已经通过现货证券市场和股票衍生产品，为投资者提供 了一站式交易和风险管理服务。这些产品是我们根据全球投资者不断变化的需求陆续开发出来的，已经构成了一个丰富的证券产品生态圈。为了进一步连接 资本与机遇，未来我们将大力发展固定收益和货币市场，在这一资产类别上培育出一个同样丰富的产品生态圈。" 据介绍，过去十年，中国内地的固定收益市场迅速发展，规模激增了五倍，目前已经高达24.6万亿美元，位居全球第二。中国内地一直在推动市场改革，包 括加强与全球市场的互联互通。在政策的大力支持下，香港交易所预期内地固定收益市场将持续高速增长，而且，内地固定收益市场与离岸固定收益市场的 互联互通也将增强。这将为全球投资者分享中国成长红利带来巨大的全新机遇。 而为了方便全球投资者分享这一机遇，香港交易所一 ...

Investment Rating - The report maintains a "Buy" rating for Hong Kong Exchanges and Clearing Limited (0388.HK) [8]. Core Views - In the medium to long term, the report anticipates that a series of connectivity policies will enhance the basic conditions for recovery in the capital market, leading to increased liquidity and overall market activity and valuation for the Hong Kong stock market [2][6]. - The company achieved revenue and other income of HKD 223.74 billion in 2024, representing a year-on-year increase of 9.06%, and a net profit attributable to shareholders of HKD 130.50 billion, up 10.0% year-on-year [6]. Summary by Relevant Sections Financial Performance - For the full year 2024, Hong Kong Exchanges reported a revenue of HKD 223.74 billion, a 9.06% increase year-on-year, and a net profit of HKD 130.50 billion, reflecting a 10.0% year-on-year growth. In Q4 2024, the net profit increased by 45.55% and 20.19% on a year-on-year and quarter-on-quarter basis, respectively [6][10]. - The breakdown of revenue sources shows that trading and trading system usage fees, listing fees, settlement and clearing fees, and other income have varied growth rates, with trading fees increasing by 18.22% and settlement fees by 21.42% [6][10]. Market Activity - The report highlights a significant increase in trading activity across various markets, with the average daily turnover in the stock market rising by 28.8% year-on-year and the average daily turnover in the Shanghai-Hong Kong Stock Connect increasing by 38.6% [6][10]. - The report notes that the number of new listings increased, with 71 new companies listed in 2024, raising a total of HKD 23.2 billion, despite a slight decline in listing fees [6][10]. Future Projections - The report projects that the company will achieve revenue and other income of HKD 252.28 billion, HKD 275.24 billion, and HKD 296.54 billion for the years 2025, 2026, and 2027, respectively. The net profit attributable to shareholders is expected to be HKD 149.92 billion, HKD 164.50 billion, and HKD 177.93 billion for the same years [2][10]. - Corresponding PE ratios are forecasted to be 30.87, 28.13, and 26.01 for the years 2025, 2026, and 2027, respectively [2][10].

Investment Rating - The report maintains an "Accumulate" rating for the company [1] Core Views - The Hong Kong Stock Exchange (HKEX) achieved record high revenues and profits in 2024, driven by significantly increased trading activity in the Hong Kong stock market [4][9] - The report highlights a strong performance in the fourth quarter, with total revenue growing by 31.4% year-on-year to HKD 63.8 billion, and net profit increasing by 45.6% to HKD 37.8 billion [4][9] - The report anticipates continued growth in net profit for 2025-2026, with projections raised by 12.2% and 13.1% respectively [9] Summary by Sections Financial Performance - In 2024, total revenue reached HKD 22.37 billion, a year-on-year increase of 9.1%, with major business revenue at HKD 20.56 billion, up 8.5% [4] - The net profit attributable to shareholders was HKD 13.05 billion, reflecting a 10.0% increase year-on-year [4] - The EBITDA margin was 74%, up by 1 percentage point from the previous year [4] Revenue Breakdown - Trading fees, system usage fees, and settlement fees totaled HKD 11.91 billion, accounting for 53.2% of total revenue, with a year-on-year increase of 19.5% [5] - Investment income netted HKD 4.93 billion, a slight decrease of 0.6% year-on-year [5] - Listing fees from the exchange amounted to HKD 1.48 billion, down 2.6% year-on-year [5] Market Activity - The average daily trading volume for stock securities was HKD 1.2 trillion, up 28.8% year-on-year [6] - Northbound and southbound trading volumes saw significant increases, with northbound trading up 38.6% and southbound trading up 55.0% year-on-year [6] New Listings - In 2024, the HKEX welcomed 71 new listings, raising HKD 88 billion, a 90.1% increase year-on-year [7] - The report notes a healthy pipeline of 84 listing applications as of the end of 2024 [7] Future Projections - Revenue is projected to grow to HKD 25.32 billion in 2025, with a growth rate of 13.16% [10] - Net profit is expected to reach HKD 14.99 billion in 2025, reflecting a growth rate of 14.91% [10] - The report anticipates a P/E ratio of 30X for 2025, indicating a favorable valuation outlook [9]

Investment Rating - The investment rating for the company is "Outperform the Market" [5][3][12] Core Views - The company's revenue for 2024 was HKD 22.374 billion, a year-on-year increase of 9.1%, and the net profit attributable to shareholders was HKD 13.050 billion, up 10.0% year-on-year. The EBITDA margin improved to 74%, an increase of 1 percentage point from 2023 [7][3] - The fourth quarter saw significant growth, with revenue reaching HKD 6.017 billion, a year-on-year increase of 33.2%, and a quarter-on-quarter increase of 24.0%. The net profit attributable to shareholders for Q4 was HKD 3.780 billion, up 45.6% year-on-year and 20.2% quarter-on-quarter [7][3] - The report attributes the performance improvement to heightened activity in the spot and derivatives markets, with the average daily trading volume (ADT) for the exchange's spot market reaching HKD 171.5 billion, a year-on-year increase of 113.3% [8][11] Summary by Sections Financial Performance - The company reported a total revenue of HKD 22.374 billion for 2024, with a net profit of HKD 13.050 billion. The EBITDA margin was 74%, and the dividend payout ratio remained at 90% [7][3] - For Q4, revenue was HKD 6.017 billion, with a net profit of HKD 3.780 billion, indicating strong performance driven by trading activity [7][3] Market Activity - The average daily trading volume in the Hong Kong stock market increased significantly, with the Hang Seng Index averaging HKD 226.6 billion from January to February 27, 2025, up 79.9% from the full year of 2024 [11][2] - The company's revenue structure is closely tied to market activity, with trading fees and system usage fees accounting for nearly 60% of total revenue [11][2] Earnings Forecast - The earnings forecast for 2025 and 2026 has been adjusted upwards by 6.0% and 7.4%, respectively, with projected net profits of HKD 16.335 billion and HKD 18.152 billion for those years [3][12] - The estimated price-to-earnings (PE) ratio for 2025 is 28.0x, reflecting the company's strong earnings growth potential [3][12]

Investment Rating - The investment rating for the company is "Buy" with a target price of HKD 411.00 [8][9]. Core Insights - The company's 4Q24 performance met expectations, with revenue and net profit reaching HKD 63.8 billion and HKD 37.8 billion, respectively, representing year-on-year increases of 31% and 46% [1]. - The average daily trading volume (ADT) for Hong Kong stocks in 4Q24 was HKD 186.9 billion, a significant year-on-year increase of 105% [2]. - The company is expected to maintain high profitability in 1Q25 due to continued market enthusiasm and a sufficient IPO pipeline [1][2]. Summary by Sections Trading Business - 4Q24 trading revenue was HKD 37.4 billion, exceeding previous expectations, primarily due to a higher proportion of small transactions leading to a higher effective trading fee rate [2]. - The ADT for Hong Kong stocks increased significantly to HKD 186.9 billion, with derivatives and commodities showing mixed performance [2]. IPO Activity - The number of IPOs in 4Q24 rose to 26, with total financing amounting to HKD 32.4 billion, indicating a healthy IPO environment [3]. - The IPO queue reached 114 companies, suggesting a robust pipeline for future listings [3]. Investment Performance - The investment scale increased to HKD 238.6 billion by the end of 4Q24, although the overall investment yield declined to 2.1% [4]. - The company anticipates a gradual decrease in investment yields due to lower interest rates, but still expects to maintain reasonable returns in the short term [4]. Profit Forecast and Valuation - The net profit forecasts for 2025 and 2026 have been adjusted to HKD 13.9 billion and HKD 13.3 billion, respectively, reflecting a positive outlook based on active trading conditions [5]. - The target price has been revised upwards to HKD 411.00 based on a discounted cash flow (DCF) valuation method [5].

Investment Rating - The report maintains a "Buy" rating for the company [3][14]. Core Views - The company achieved record high performance in 2024, with total revenue of HKD 22.37 billion, a year-on-year increase of 9%, and net profit of HKD 13.05 billion, also up 10% year-on-year [1][2]. - The report highlights the sustainable improvement in Hong Kong stock market liquidity, supported by fee reforms and the influx of mainland long-term capital [1][3]. - The company is expected to benefit from the deepening interconnection between the mainland and Hong Kong IPO markets, with a significant increase in IPO activities [5][6]. Financial Data and Earnings Forecast - Revenue and profit projections for the company from 2023 to 2027 are as follows: - Revenue (in million HKD): 20,516 (2023), 22,374 (2024), 24,767 (2025E), 26,283 (2026E), 27,104 (2027E) [2][6]. - Net profit (in million HKD): 11,862 (2023), 13,050 (2024), 14,307 (2025E), 15,108 (2026E), 15,451 (2027E) [2][6]. - The company anticipates a net profit growth of 10% in 2025, 6% in 2026, and 2% in 2027 [5]. Revenue Breakdown - The company's revenue is primarily driven by trading and settlement fees, contributing nearly 60% to its main revenue. The breakdown of revenue by segment for 2024 is as follows: - Cash market: HKD 9.42 billion (+15% YoY) - Equity securities and derivatives: HKD 6.20 billion (-5% YoY) - Commodities: HKD 2.79 billion (+27% YoY) - Data and connectivity: HKD 2.13 billion (+3% YoY) - Company projects: HKD 1.83 billion (+15% YoY) [5][6]. Investment Analysis Opinion - The report raises the earnings forecast for 2025-2026 and introduces a forecast for 2027, maintaining a "Buy" rating. The company is expected to achieve net profits of HKD 14.31 billion, HKD 15.11 billion, and HKD 15.45 billion for 2025E, 2026E, and 2027E respectively [5][6].

Investment Rating - The investment rating for Hong Kong Exchanges and Clearing Limited is "Buy" [6] Core Insights - In 2024, Hong Kong Exchanges achieved a revenue of HK$22.374 billion, a year-on-year increase of 9%, and a net profit attributable to shareholders of HK$13.050 billion, up 10% year-on-year. The fourth quarter saw a significant net profit increase of 46% year-on-year and 20% quarter-on-quarter, driven by higher trading volumes in the spot and derivatives markets as well as increased investment income [1][4] - The report highlights a notable improvement in trading volumes, particularly in the spot market, where the average daily trading volume increased by 26% year-on-year. The stock connect programs also saw significant growth, with daily trading volumes increasing by 55% and 39% for Hong Kong and mainland China respectively [2] - The report projects a net profit growth of 10% for 2024, benefiting from increased trading volumes and investment income, with expected net profit growth rates of 20%, 10%, and 10% for 2025, 2026, and 2027 respectively [4][11] Summary by Sections Performance Overview - In 2024, the revenue breakdown by business lines showed a year-on-year growth of 15% for the spot market, a decline of 5% for derivatives, a growth of 27% for commodities, 3% for data and connectivity, and 15% for company projects [1] - Revenue from trading and trading system usage fees grew by 18%, while listing fees decreased by 3%. Settlement and clearing fees increased by 21% [1] Trading Activity - The report notes that the trading activity in the derivatives market improved, with a slight revenue increase of 2% in 2024. The trading income from structured products also saw a 3% increase, a significant recovery compared to a 10% decline in the first three quarters of 2024 [2] - The commodities market remained active, with trading fees from LME and LME Clear increasing by 33% and 30% respectively, attributed to an 18% rise in average daily trading volumes [2] Fundraising and Listings - In 2024, the number of new listings on the Hong Kong Stock Exchange was 71, a decrease of 2 from 2023, but the total fundraising amount increased by 90%, primarily due to the listing of Midea Group, which was the largest IPO in Hong Kong since February 2021 [3] - The report also mentions that the number of new derivative warrants and structured products listed increased by 43% in the fourth quarter of 2024 [3] Earnings Forecast and Valuation - The forecast for 2025-2027 indicates an expected EPS of HK$12.40, HK$13.62, and HK$14.94, with corresponding P/E ratios of 29, 27, and 24 times respectively. The target price for 2025 is set at HK$471.01, based on a 38 times P/E ratio [4][11]

Investment Rating - The report maintains a "Buy" rating for Hong Kong Exchanges and Clearing Limited (00388.HK) [1] Core Views - The report highlights that Hong Kong Exchanges achieved record high annual and quarterly performance, driven by increased trading activity due to economic stimulus measures in mainland China [7] - The report projects continued growth in trading volumes and revenues, with significant increases in both the cash and derivatives markets [7] - The earnings forecast has been revised upwards, with expected shareholder profits for 2025 and 2026 at HKD 149.34 billion and HKD 156.73 billion respectively, reflecting growth rates of 14% and 5% [7] Summary by Sections Financial Performance - For 2024, total revenue reached HKD 22,374 million, a year-on-year increase of 9% [7] - Net profit attributable to shareholders was HKD 13,050 million, up 10% year-on-year [7] - The fourth quarter alone saw revenue of HKD 63.81 billion, a 31% increase year-on-year, and net profit of HKD 37.8 billion, up 46% year-on-year [7] Trading Volume and Market Activity - The average daily trading volume in the cash market increased by 26% to HKD 1,318 billion [7] - The Northbound and Southbound trading under the Stock Connect saw average daily trading volumes of HKD 1,502 billion and HKD 482 billion, representing increases of 39% and 55% respectively [7] - The report notes that the derivatives market also experienced growth, with average daily contract volumes reaching a historical high of 1.55 million contracts, up 15% year-on-year [7] Revenue Breakdown - The cash segment generated revenue of HKD 94.22 billion, a 15.4% increase, accounting for 42% of total revenue [7] - The derivatives segment reported revenue of HKD 62.04 billion, a decrease of 5% due to increased interest rebates for certain contracts [7] - The commodities segment saw revenue of HKD 27.88 billion, up 27% year-on-year [7] Future Projections - The report anticipates continued strong performance, with projected revenues for 2025 and 2026 at HKD 25,538 million and HKD 27,058 million respectively [1] - The expected earnings per share (EPS) for 2025 and 2026 are HKD 11.78 and HKD 12.36 respectively, with corresponding P/E ratios of 30.99x and 29.53x [1]

Core Viewpoint - The Hong Kong Securities and Futures Commission (SFC) has proposed to increase the position limits for futures and options contracts based on the Hang Seng Index, Hang Seng China Enterprises Index, and Hang Seng Tech Index by 50%, 108%, and 43% respectively, to align with market growth and enhance risk management [1][2][3]. Group 1: Regulatory Changes - The proposed position limits will increase to 15,000, 25,000, and 30,000 contracts for the respective indices, up from 10,000, 12,000, and 21,000 contracts [2]. - The position limit system was established in 1999 to enhance market transparency and prevent large positions that could disrupt market stability [2][4]. - The SFC believes that the current position limits are too low and may hinder market hedging and trading activities [4]. Group 2: Market Performance - The Hong Kong stock market has seen significant growth over the past decade, with the market capitalization of the Hang Seng Index and Hang Seng China Enterprises Index increasing by approximately 60% and 250% respectively [3]. - The average daily trading volume for the constituent stocks of these indices has also risen significantly, by about 160% and 300% [3]. Group 3: Financial Results - The Hong Kong Stock Exchange (HKEX) reported record high revenues and profits for the year 2024, with total revenue and other income reaching HKD 22.374 billion, a 9% increase from 2023 [9][10]. - The net profit attributable to shareholders for 2024 was HKD 13.050 billion, up 10% year-on-year [9][10]. - In Q4 2024, HKEX's revenue and other income were HKD 6.4 billion, reflecting a 31% year-on-year increase, while net profit for the same period rose by 46% [10]. Group 4: Market Outlook - The HKEX is expected to benefit from a recovering IPO market and increased southbound capital inflows, with analysts raising target prices for the exchange [11]. - The exchange plans to continue optimizing its listing mechanisms to enhance the attractiveness of its new stock market [11].