Hong Kong Exchanges and Clearing Ltd

00388: XHKG (HKG)

Morningstar Rating for Stocks	Fair Value	Economic Moat	Capital Allocation
	HK$732.00	Tfdsm	Dcvzxgq

Hong Kong Exchanges and Clearing Earnings: Resiliency From Diversified Business Exposure

Roy Van Keulen

Oct 22, 2023

We maintain our HKD 300 fair value estimate for wide-moat Hong Kong Exchanges and Clearing, or HKEx, following its third-quarter results. During the quarter, ongoing concerns about economic growth in China saw the Hang Seng Index continue its downward trajectory and underperformance compared with other major stock markets, thereby hitting HKEx’s trading-related businesses. However, HKEx delivered a 30% increase in net profit after tax compared with the previous corresponding period on the back of strong net investment income.

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