Japan Exchange Group, Inc.

Business Details

Japan Exchange Group, Inc. is a financial instruments exchange holding company group that provides a full range of services related to the Japanese market, from the listing of securities and derivatives, provision of trading venues, and clearing and settlement services to index and information services. It operates the cash equities market, derivatives market, clearing organization (Japan Securities Clearing Corporation), and information services in an integrated manner, with revenue composed of six categories: trading-related, clearing-related, listing-related, information-related, and system-related. The group is advancing its business development based on the "Medium-Term Management Plan 2027," with FY2025 (ending March 2025) as its first year.

Recent Overview

Operating revenue and profit both reached record highs, driven by a sharp increase in cash equities trading value and substantial growth in clearing-related revenue

In FY2026 (ending March 2026), the group achieved operating revenue of ¥198,735 million (up 22.5% year on year) and operating profit of ¥116,289 million (up 29.0% year on year). Growth was driven by cash trading fees, which rose 28.2% year on year to ¥55,265 million, and clearing-related revenue, which rose 57.5% year on year to ¥54,242 million. Operating expenses remained relatively contained at ¥83,598 million (up 11.4% year on year), although other expenses increased 63.7% year on year to ¥20,422 million. For FY2027 (ending March 2027), the group forecasts operating revenue of ¥205,000 million and operating profit of ¥115,000 million. As a subsequent event, on April 28, 2026, the company resolved to conduct a share buyback with an upper limit of ¥20.0 billion and 40 million shares.

Key Products

Growth Drivers

• Increase in cash equities trading value (cash trading fees in FY2026 (ending March 2026) rose 28.2% year on year to ¥55,265 million)
• Substantial expansion in clearing-related revenue (up 57.5% year on year to ¥54,242 million)
• Stable growth in listing-related revenue driven mainly by increased annual listing fees (up 7.9% year on year to ¥18,682 million)
• Increase in information-related revenue driven by growth in market information fees and index business revenue (up 5.5% year on year to ¥33,669 million)
• Expansion of co-location service usage fees (up 9.9% year on year to ¥6,480 million)
• Promotion of comprehensive platform development and digital innovation under the "Medium-Term Management Plan 2027" (strengthening interest rate-related products, next-generation data services, etc.)
• Share buyback aimed at improving capital efficiency (resolved on April 28, 2026, with an upper limit of ¥20.0 billion and 40 million shares)

Risks

• Decline in trading value and volume due to deterioration of the Japanese economy or a downturn in the stock market (the majority of revenue is volume-based)
• Sudden changes in market volatility due to shifts in the external environment, such as monetary policy or geopolitical risks
• Risk of declining market share due to intensifying competition from domestic PTS and overseas exchanges
• System risk from failures or cyberattacks affecting core systems (arrowhead, J-GATE)
• Default risk of clearing participants in the group's role as a clearing organization (clearing deposits and liabilities fluctuate significantly on a daily basis)
• Goodwill impairment risk (the possibility of a significant decline in estimated cash flows in the event of economic deterioration)
• The FY2027 (ending March 2027) earnings forecast anticipates a decline in both operating profit and profit attributable to owners of parent compared to FY2026 (ending March 2026) results, presenting a risk of revenue reversion as market conditions normalize