Hong Kong exchange’s 2023 profit misses forecast as new listings, trading income sags
HONG Kong’s bourse operator on Thursday (Feb 29) reported an 18 per cent profit rise in 2023, but missed estimates as higher investment income was offset by a drop in trading and listing activities amid worsening macro conditions in the Asian financial hub.
China’s economic slowdown, a sweeping regulatory tightening that hampered large companies’ fundraising outside mainland China, and geopolitical tensions have all resulted in a bleak year for new listings in Hong Kong.
Noting challenges including high interest rates, a complex geopolitical environment as well as ballooning recent budget deficits, Hong Kong on Wednesday announced a mix of measures to lure back capital, businesses, and visitors to the city.
The profit attributable to shareholders of Hong Kong Exchanges and Clearing rose to HK$11.86 billion (S$2 billion) last year from HK$10.08 billion in 2022, according to its earnings statement.
The profit, however, is smaller than a HK$12 billion average forecast from analysts compiled by LSEG.
Net investment income from the exchange’s corporate funds during the year posted a gain of HK$1.5 billion, compared to a loss of HK$48 million in the year-ago period, according to the statement.
Against the backdrop of global economic and geopolitical challenges, however, the Hong Kong initial public offering market saw a decrease in activity in 2023, with 73 company listings raising HK$46.3 billion, a drop of 56 per cent compared with 2022, it added.
The average daily turnover of equity products traded on the Hong Kong stock exchange also posted a drop of 14 per cent to HK$93.2 billion during 2023 compared to the preceding year, according to the statement. REUTERS
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