Core Viewpoint - CICC has raised its profit forecasts for Hong Kong Exchanges and Clearing (HKEX) for 2025 and 2026 by 7.3% and 4.0% to HKD 165 billion and HKD 173 billion respectively, maintaining an outperform rating and increasing the target price by 8% to HKD 500, indicating a potential upside of 15.3% [1] Group 1 - HKEX's Q2 2025 main fee income met expectations, while profits exceeded both CICC's and market forecasts [2] - Q2 2025 total revenue increased by 33% year-on-year and 5% quarter-on-quarter to HKD 72.2 billion, with main fee income rising by 31% year-on-year and 1% quarter-on-quarter to HKD 55.4 billion, and profits up by 41% year-on-year and 9% quarter-on-quarter to HKD 44.4 billion [2] - For the first half of the year, total revenue rose by 33% year-on-year to HKD 140.8 billion, and profits increased by 39% year-on-year to HKD 85.2 billion [2] Group 2 - Q2 trading and settlement income grew by 40% year-on-year but decreased by 5% quarter-on-quarter, with active spot trading and weakening marginal performance in derivatives [2] - Spot trading and settlement income increased by 65% year-on-year but decreased by 4% quarter-on-quarter, with an average daily turnover (ADT) of HKD 2,377 billion, up 95% year-on-year [2] - The number of IPOs completed in Q2 was 27, raising HKD 907.5 billion, a significant increase of 960% year-on-year and 386% quarter-on-quarter [2] Group 3 - Total investment income in Q2 increased by 31% year-on-year and 16% quarter-on-quarter to HKD 16.8 billion, with a 17% year-on-year and 6% quarter-on-quarter increase when excluding non-recurring foreign exchange gains [3] - Margin and clearing house fund income rose by 25% year-on-year and 24% quarter-on-quarter to HKD 10.1 billion, driven by increased margin requirements and higher open interest in derivatives [3] - Proprietary fund income, excluding foreign exchange impacts, grew by 6% year-on-year but fell by 19% quarter-on-quarter to HKD 3.9 billion, attributed to an increase in fund scale [3]