Bursa M’sia likely to record higher net profit in 3Q17
KUALA LUMPUR: Bursa Malaysia Sdn Bhd (Bursa Malaysia) will likely record a net profit of RM45 million to RM50 million in the third quarter of 2017 (3Q17), lifting its first nine months of 2017 (9M17) net profit to RM161 million to RM166 million, analysts observed.
The research arm of Maybank Investment Bank Bhd (Maybank IB Research) noted that the average daily trading value (ADV) for equities normalised to an estimated RM2.13 billion in 3Q17, after strong RM2.81 billion in 2Q17, RM2.54 illionb in 1Q17.
This brings 9M17 equities ADV to circa RM2.48 billion, an increase of 25 per cent year-on-year (y-o-y), which is in line with the research team’s RM2.5 billion forecast for the year.
“9M17’s rise in ADV came from domestic investors as foreign participation was lower at circa 22 per cent of total trade value (9M16: 27 per cent),” it explained.
Meanwhile, it noted that derivatives volume was flattish at 3.47 million in 3Q17 (2Q17: 3.39 million), which lifts 9M17 volume to 10.65 million (down one per cent y-o-y).
Aside from that, it pointed out that 9M17 FCPO contracts (84 per cent of total) was higher by an estimated four per cent y-o-y, while FKLI contracts (15 per cent of total) fell an estimated 26 per cent y-o-y.
“Trading revenue from equities and derivatives made up 51.5 and 15.1 per cent of 1H17 operating revenue,” it said.
Maybank IB Research further noted equities ADV in the first 12 trading days of October 2017 was RM2.45 billion.
Looking ahead, the research team highlighted that seasonally, 4Q17 could see higher trading activities quarter-on-quarter (q-o-q) due to year-end window dressing.
“We maintain our 2017 equities ADV forecast of RM2.5 billion (compared with 2016’s RM2 billion) and RM2.6 billion for 2018,” it said.
Overall, Bursa Malaysia’s cash balance stood at RM332 million end-Jun 2017. Maybank IB Research said, its proforma would have come off to RM144 million, post RM188 million dividend payment in August 2017 (15 sen special, 20sen 1st interim DPS).
“We expect another 18.5sen for FY17, which implies a DPR of 93 per cent (ex- special dividend). We have yet to impute impact from the newly launched LEAP Market (on July 25); not expected to be a major revenue generator while the additional opex will be small, leveraging on Bursa’s existing platform,” it added.