2H26 Outlook: Enjoy the Ride

Research evidence excerpt

2H26 Outlook: Enjoy the Ride

Hong Kong | Brokers, Asset Mgrs & Exchanges

HK Exchanges and Clearing Ltd. EquityJulyResearch22, 2026

TARGET CHANGE2H26 Outlook: Enjoy the Ride

There are reasons to be optimistic in 2H. IPO quality and demand RATING BUY

have improved materially, with lower break rates and greater institutional PRICE HK$397.40^

support. Lock-up expiry risks appear manageable, while AI rotation and PRICE TARGET | % TO PT HK$513.00 (HK$502.00)

Korea sell-offs create market entry opportunities. We increase 26/27E | +29%

52W HIGH-LOW HK$466.00 - HK$360.00

earnings outlook by 5%/6% on healthy IPO pipelines (528), ample China

FLOAT (%) | ADV MM (USD) 93.9% | 268.52

liquidity, and resilient HIBOR outlook. Lift PT to HK$513.

MARKET CAP HK$503.3B | $64.2B

Supportive China liquidity and US rate outlook. Market activity remains robust across asset TICKER 388 HK

^Prior trading day's closing price unless otherwise

classes: cash equity turnover rose 19% yoy to HK$286bn, IPO fundraising surged 92% YoY to noted.

HK$210bn in 1H26 and reached HK$271bn in July, while commodities and derivatives volumes

all posted solid HSD growth. A strong IPO pipeline (528 in June) and potential marquee listings

should further underpin trading and earning momentum, while an increasing HIBOR outlook FY (Dec) CHANGE TO JEFe JEF vs CONS

offering solid NII support. 2026 2027 2026 2027

REV NA NA NA NA

Another 2021? Not yet in our view. IPO quality and demand have improved materially, with EPS NA NA NA NA

first-day break rates falling to 17% in 2026 from 32-45% in 2020-21, supported by A+H and AI-

related listings (72% of total fund raised) and increased institutional participation from state 2026 (HK$) Q1 Q2 Q3 Q4 FY

capital and southbound.