Operating an integrated securities and derivatives exchange across different asset classes. SGX is the leading securities market in Southeast Asia, exchanging trade stocks and bonds, ETF, warrants, derivatives and infrastructure funds.

The Equities segment contribute an estimated 70-80% to total revenues, while Fixed Income, Currencies and Commodities (FICC) and Data, Connectivity and Indices (DCI) contribute 10-20% each.  Looking ahead, the company expects FICC and DCI to be relatively faster growth areas.

The company has committed to a progressive dividend policy, and guided for  annualized dividend of 32 cents/sh (raised from FY20’s payout of 30.5 cents/share). While we are positive on its initiatives to broaden its revenue streams, time will be needed while a key concern remains on  competition risks in the China A50 equity derivatives space. HOLD.

Source: OCBC Research - 26 Jan 2021