Core Viewpoint - Hong Kong Stock Exchange (HKEX) reported strong financial performance for 2025, with total revenue of HKD 29.161 billion (up 30.3% year-on-year) and net profit attributable to shareholders of HKD 17.754 billion (up 36.0% year-on-year) [1] Revenue Structure - Increased trading activity led to a rise in the proportion of trading fees and settlement fees, which accounted for 64.7% of total revenue in 2025 (up 6.4 percentage points year-on-year) [1] - Revenue sources include trading and trading system usage fees, settlement and clearing fees, listing fees, custody and agent service fees, investment income, and market data fees [1] Cash Market Performance - The cash market revenue reached HKD 14.704 billion in 2025 (up 56.1% year-on-year), with trading fees and related services contributing HKD 13.291 billion (up 64.1% year-on-year) [2] - The average daily trading amount in the cash market reached HKD 249.8 billion (up 90% year-on-year), with significant increases in both northbound and southbound trading under the Stock Connect program [2] Listing Fees - Listing fees amounted to HKD 0.964 billion in 2025 (up 8.6% year-on-year), with a total of 119 new listings raising HKD 286.9 billion (up 227% year-on-year), making HKEX the top global market for new stock financing [3] - The number of IPO applications increased to 345 (up 311% year-on-year), indicating a significant market recovery [3] Derivatives Market - The derivatives segment saw trading fees and related services revenue of HKD 3.316 billion (up 14.0% year-on-year), with average daily contract volume reaching 1.6628 million contracts, a new record [4] - The increase in trading activity was driven by stock options and futures contracts [4] Investment Income - Investment income netted HKD 5.111 billion in 2025 (up 3.7% year-on-year), with margin and clearing fund investments yielding HKD 3.241 billion (up 2.0% year-on-year) [5] - The annualized investment return rate for margin and clearing fund investments was 1.32% (down 0.24 percentage points year-on-year) [5] Future Outlook - The global trend towards capital diversification and changing market dynamics present growth opportunities for HKEX, which aims to enhance liquidity and market efficiency while developing a diversified asset ecosystem [6] - Earnings per share (EPS) forecasts for 2026, 2027, and 2028 are adjusted to HKD 14.77, 16.34, and 17.87 respectively, with a target price of HKD 516.9 based on a 35x PE valuation for 2026 [6]