Lates News

date
28/04/2025
Goldman Sachs released a research report stating that the Hong Kong Stock Exchange announced the purchase of the Central Loop Trading Square property for use as its permanent headquarters. According to the terms of the transaction agreement, it is expected that the Hong Kong Stock Exchange will effectively convert the investment returns from its external investment portfolio into a capitalization rate of 3%. They believe that realizing external investments will help reduce the volatility of investment income. Over the past nine years, the Hong Kong Stock Exchange's external investment portfolio has generated an annual investment return rate of around 4%. In comparison, Goldman Sachs predicts that the investment return rate for the fiscal years 2026 to 2027 will range from 5% to 6%. Currently, the transaction is expected to have a negative impact on the Exchange's pre-tax profit of approximately 1.5% to 2%, or reduce investment income by around HK$350 million, but at the same time, it will save approximately HK$180 million in rent. Goldman Sachs believes that the Hong Kong Stock Exchange's acquisition of the headquarters property will help strengthen its position as an important component of the Hong Kong financial market infrastructure and as a brand image connecting exchanges between the East and West. They have set a target price of HK$378 and rated it as a "Buy".