BURSA: Equities Exchange Operator Meets FY25 Expectations, Buoyant Outlook on Market Inflows

The nation’s leading equities exchange operator delivered a financial performance for the full year 2025 that largely aligned with both analyst and consensus expectations. Despite a decline in annual net profit, robust operational highlights in the fourth quarter and a positive outlook for market liquidity inflows are setting the stage for a promising year ahead.

Performance Review

For the full financial year 2025 (FY25), the operator reported a net profit (PATMI) of MYR250 million, marking a 19% year-on-year decrease. The fourth quarter of 2025 saw a net profit of MYR61 million, a 5% quarter-on-quarter (QoQ) and 12% year-on-year (YoY) decline. This QoQ fall was primarily attributed to seasonally higher operating expenses, including increased staff costs and business development expenditures. The full-year earnings contraction stemmed from softer securities trading revenue combined with elevated operating expenses. A final dividend per share (DPS) of 14 sen was declared, bringing the total 2025 DPS to 28 sen, representing a 91% payout, a reduction from the 136% payout in FY24.

Operational Highlights

The fourth quarter of 2025 demonstrated strong operational resilience. Securities Average Daily Value (SADV) notably increased QoQ to MYR3.0 billion, up from MYR2.8-2.9 billion in the preceding quarters. This sequential rebound was fueled by improved investor sentiment, buoyed by greater clarity on global tariffs. The derivatives market also experienced a sequential pickup, with Average Daily Contracts (DADC) traded at 97.4k, representing a 7% QoQ increase, driven by higher FCPO and FKLI contracts. Furthermore, the operator saw 19 new IPOs in 4Q25, bringing the total for 2025 to 60 IPOs, successfully meeting its annual target. The total IPO market capitalization for 2025 reached MYR27.4 billion, slightly surpassing the revised target of MYR25.2 billion.

Future Outlook and Strategy

Looking ahead to 2026, the operator maintains a positive outlook, anticipating strong liquidity inflows to bolster trading volumes. Key financial performance indicators for 2026 include a Return on Equity (ROE) between 27-30% and non-trading revenue growth exceeding 10%. Non-financial KPIs target a total IPO market capitalisation of MYR28 billion, with operating expenses expected to grow between 5-8%, and a dividend payout ratio of approximately 90%. Analysts project a more optimistic ROE of 34.5% for 2026, surpassing the operator’s own target, indicative of a sanguine view on SADV. The operator emphasizes its focus on enhancing the local market’s attractiveness and vibrancy through various initiatives, including a corporate value-up program with the relevant authorities. Revisions to future net profit forecasts for 2026 and 2027 have been made (+2% and -4% respectively), primarily driven by adjusted SADV assumptions.