- For 1HFY25, SGX reported record-high revenue (+15.2% y-o-y) and adjusted PATMI (+27.3% y-o-y), driven by broad-based growth across all business segments.
- However, we opine that SGX is fairly valued at current price levels.
SGX reported robust 1HFY25 results.
- - Read this at SGinvestors.io -
- The stronger revenue was driven by increased contributions from all business segments, particularly the cash equities segment which saw trading and clearing (T&C) revenue surge 39.4% y-o-y. The strong beat on our PATMI estimates was due to lower-than-expected operating expenses which were stable y-o-y.
- - Read this at SGinvestors.io -
Cash equities: Sharp rebound.
- In line with expectations, 1HFY25 segmental revenue surged (+21.9% y-o-y) as both securities daily average value (SDAV) improved 31.2% y-o-y to S$1.3b (1HFY24: S$1.0b) and overall clearing fees rose to 2.57bp (1HFY24: 2.45bp). As a result, 1HFY25 T&C revenue surged 39.4% y-o-y to S$107.6m, close to our S$105m estimate.
- Moving forward, we maintain our expectation that an uncertain macroeconomic outlook, coupled with expected interest rate cuts in 2025, would improve trading velocity, pushing the cash equities segment into revenue and profitability growth.
- Furthermore, upcoming announcements from the Monetary Authority of Singapore (MAS) review group to revitalise the domestic stock market would likely boost investor sentiment in 2025.
Equity derivatives: Strong performance.
- Read more at SGinvestors.io.
