Japan Exchange Group (JPX) relies on trading fees as a major revenue source, with active cash equity trading driving revenue growth. At the same time, ROE has improved only marginally, and analysis indicates that investor expectations have led the improvement in PBR.
Japan Exchange Group’s (JPX) business model is said to center not only on operating the market but also on transaction-related income, particularly from cash equity trading. Of the ¥65.515 billion in operating revenue recorded in the first quarter of the fiscal year ending March 2027, transaction-related income accounted for ¥27.837 billion, including ¥24.647 billion in trading fees, its core component. Cash equity trading accounted for ¥21.928 billion, or 89.0% of transaction-related income.
According to an analysis by Izumida Ryosuke (泉田 良輔), the more active cash equity trading becomes, the greater JPX’s fee income and overall revenue, while revenue could decline if market momentum cools. JPX is said to be continuing initiatives aimed at sustaining market activity. This market revitalization is cited as one factor behind JPX’s strong performance.
Although PBR has improved, it has been pointed out that the improvement in ROE has remained limited. One view is that, when reviewing news about an improvement in PBR, investors should check whether it is accompanied by an improvement in ROE. There is also an opinion that management’s capital policy will come under scrutiny going forward.