Hong Kong exchange operator HKEX expects 11pc rise in interim profit on higher market turnover

Hong Kong Exchanges and Clearing, the local bourse operator, is expected to post 11 per cent net profit growth for the first half of 2017 as a result of better market turnover and higher volume of derivative trading, according to analysts.

HKEX is expected to report on Wednesday that its second quarter net profit grew 3 per cent to HK$1.6 billion, or HK$1.34 per share, according to consensus of analysts polled by Bloomberg. They expected revenue for the quarter would be up 7 per cent to HK$3.09 billion.

Add the already announced first quarter net profit of HK$1.72 billion and the bourse operator’s first half profit is expected to reach HK$3.32 billion, up 11 per cent from HK$2.99 billion in the same period last year.

First half revenue is expected to grow 10.98 per cent to HK$6.248 billion, up from HK$5.6 billion in the first half of last year.

“In the first half of 2017 the average daily turnover was HK$76 billion which is up 12.6 per cent year on year from the first half of 2016. The higher market turnover brought in better fee income which contributes to the profit for HKEX,” said Kenny Wen, a wealth management strategist at Sun Hung Kai Financial.

“The volume of derivative products trading also reach a record high level in the first half of this year which also brought in higher fee income,” Wen said.