Jinwu Financial News | Changjiang Securities released a Research Report stating that the Hong Kong Stock Exchange had a high level of market activity in May, with a significant recovery in IPOs contributing to performance growth, and revenue and profit are expected to grow significantly from 2025 to 2027.
As of the end of May, the PE ratio of the Hong Kong Stock Exchange is 35.45x, placing it at the 44th percentile historically since 2016, which offers some cost-effective allocation. It is expected that as the interconnection policies continue to strengthen Hong Kong's Capital Markets, the liquidity of the Hong Kong stock market will continue to rise, and the overall market activity level and valuation are expected to improve accordingly. The company is forecasted to achieve revenue and other income of 29.8/31/32.5 billion HKD from 2025 to 2027, with net income to shareholders of 17.9/18.6/19.6 billion HKD, corresponding to PE valuations of 29.2/28.0/26.6 times, and a "Buy" rating is given.
In May, the Hong Kong stock market overall rose, and the trading activity of listed securities on the Hong Kong Stock Exchange remained high. The Hang Seng Index and Hang Seng Technology increased by 16.1% and 15.7% respectively compared to the end of 2024; the monthly ADT of the Hong Kong Stock Exchange is 210.3 billion HKD, with month-on-month and year-on-year changes of -23.4% and +50.4% respectively; the monthly ADT of Shanghai and Shenzhen Stock Connect is 906.13 billion HKD, with month-on-month and year-on-year changes of -6.9% and +22.4% respectively; the monthly ADT of Shanghai-Shenzhen-Hong Kong Stock Connect is 147.42 billion HKD, with month-on-month and year-on-year changes of -22.9% and +50.1%.
In the derivatives market, Futures and Options trading both saw a month-on-month and year-on-year decline. In the commodity market, LME trading volume also decreased compared to the previous month and year. In the primary market, the scale of Hong Kong stock IPOs saw a substantial increase compared to the prior month, with a total of 10 new stocks listed in May, amounting to 55.8 billion HKD, representing increases of 1830.4% and 3150.6% compared to the previous month and year respectively.
Regarding investment income, the interest rates related to investment income at the Hong Kong Stock Exchange have declined month-on-month and year-on-year. As of the end of May, the HIBOR for 6 months, HIBOR for 1 month, HIBOR overnight, and the U.S. overnight bank fund rate were 2.16%, 0.59%, 0.03%, and 4.33% respectively.
The domestic economy is showing signs of recovery, with improvements on both the supply and demand sides. On the overseas front, the pause in interest rate cuts has led to a tightening of overseas liquidity, and expectations for interest rate cuts by the Federal Reserve are continuously delayed.
