Singapore Exchange (SGX) is set to report a 17% year-on-year increase in core profit after tax and minority interest (PATMI) for the second half of the financial year ending June 2025, reaching $235m (S$321.6m). This growth is attributed to strong trading volumes and heightened demand for over-the-counter (OTC) foreign exchange (FX) products.
SGX’s trading volumes have seen significant growth, with the securities daily average value (SDAV) increasing by 22% year-on-year to $1.04b (S$1.42b), and the derivatives daily average volume (DDAV) rising by 13% to 158.9m contracts. The exchange’s FX derivative products also experienced a 66% year-on-year increase in volume, reaching 33.9m contracts from January to May 2025.
The Monetary Authority of Singapore’s (MAS) $3.67b (S$5b) Equity Market Development Programme (EQDP) is expected to further stimulate trading volumes on SGX in the coming years. This initiative, along with recent and anticipated listings such as Info-Tech Systems and NTT DC REIT, could enhance liquidity and attract investor interest.
Analyst Tay Wee Kuang has upgraded SGX’s rating to “Add” and increased the target price to $13.34 (S$18.30), based on a 28x price-to-earnings ratio. The exchange is viewed as a defensive pick, with an expected earnings compound annual growth rate (CAGR) of 5.9% from FY25 to FY27. Potential re-rating catalysts include government measures to boost the equity market and capital return initiatives.
SGX’s robust performance amidst global economic uncertainty highlights its resilience and strategic positioning in the market. The exchange’s focus on enhancing technology and cost efficiency is expected to support sustainable growth in the medium term.
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