Singapore Exchange (SGX: S68) has been on a strong run in 2026, delivering solid capital appreciation alongside steady payouts.
Surging trading activity, a revived domestic stock market, and policy moves to boost liquidity have provided clear tailwinds.
As Singapore’s sole equity exchange with an expanding moat across FX and derivatives, SGX sits right at the heart of the country’s financial engine.
Yet after such a strong run, investors have to ask: is future growth already priced in, or is there still value left on the table?
What is Driving SGX’s Earnings Surge?
SGX’s stock rally was caused by a sharp rebound in local market activity.
Over the past year, total shareholder returns were propelled by a 34.9% jump in Securities Daily Average Traded Value (SDAV) to S$1.8 billion, driving cash equities revenue up 28.1% to S$502.9 million.
Beyond traditional stock trading, currency clearing reached record volumes, pushing FX net revenue up 12% to S$126.6 million as average daily volume hit US$190.2 billion.
This multi-asset diversification gives the exchange a recurring earnings cushion whenever equity turnover cools down.
Efforts by the Singapore government to deepen market liquidity and attract new growth listings have provided additional structural tailwinds.
If these capital market reforms permanently channel institutional capital into local shares, SGX stands to collect steady clearing and listing fees for years to come.
Is SGX’s Business Getting Stronger?
Over the past three financial years, SGX Group delivered strong growth, with FY2026 gross revenue up 26.6%, adjusted EBITDA up 37.8%, and adjusted net profit up 44.4% compared to FY2024.
| Financial Metric (S$) | FY2024 | FY2025 | FY2026 | 3-Year Growth (%) |
|---|---|---|---|---|
| Gross revenue | 1,231.7M | 1,370.6M | 1,559.5M | +26.6% |
| Adjusted EBITDA | 711.6M | 832.0M | 980.6M | +37.8% |
| Adjusted Net Profit | 525.9M | 609.5M | 759.5M | +44.4% |
| Reported Net Profit | 597.9M | 648.0M | 698.4M | +16.8% |
This earnings jump confirms that the stock rally is backed by real operational results.
Adjusted earnings per share (EPS) rose 24.6% to S$0.71.
In FY2026, adjusted expenses grew just 5.5%, expanding adjusted EBITDA margins to 66.3%.
Low capital expenditure needs to generate high free cash flow, leaving SGX with S$1.8 billion in cash reserves and plans to clear all debt in FY2027.
Can SGX Continue Growing Its Dividends?
SGX has delivered steady dividend growth across recent financial years.
The table below shows its payout progression from FY2021 through FY2026:
| Fiscal Year | Regular Dividend Per Share (SGD) | Special / One-Off Dividend (SGD) | Total Dividend Per Share (SGD) |
|---|---|---|---|
| FY2021 | 0.320 | — | 0.320 |
| FY2022 | 0.320 | — | 0.320 |
| FY2023 | 0.325 | — | 0.325 |
| FY2024 | 0.345 | — | 0.345 |
| FY2025 | 0.375 | — | 0.375 |
| FY2026 | 0.445 | 0.125 | 0.570 |
For FY2026, SGX raised its regular dividend to S$0.445 per share, an 18.7% increase over FY2025.
Management also declared a one-off capital return dividend of S$0.125 per share, bringing total FY2026 distributions to S$0.570 per share.
Furthermore, management has guided for planned quarterly dividend increases of S$0.0025 through FY2028.
At a recent share price of around S$20.73, the regular dividend of S$0.445 provides a baseline yield of approximately 2.15%, which increases to roughly 2.75% when factoring in the one-off distribution.
SGX’s dividend growth is backed by strong cash generation and a conservative balance sheet.
Regular dividend distributions are fully supported by FY2026 adjusted net profit of S$759.5 million, leaving a comfortable payout ratio below 63% on ordinary dividends.
SGX is best understood as a defensive compounder operating with high capital efficiency.
At a 2.15% regular yield, it’s lower than a 10-year Singapore Savings Bond.
Similarly, its targeted medium-term revenue growth of 6% to 8% positions it as a steady rather than high-beta growth stock.
Is SGX Still Attractively Valued After Its Rally?
At around 29.2x adjusted trailing earnings, SGX trades well above its historical 5-year average P/E range of 21x to 23x.
The market pays this premium for SGX’s earnings stability, cash conversion, and wide regulatory moat.
However, trading near the top of its historical valuation band leaves little margin of safety.
While FY2026 adjusted EPS jumped 24.6% to S$0.71, the stock’s multi-month price advance outpaced underlying profit growth.
A significant portion of recent total returns came from valuation expansion, where investors paid progressively more per dollar of earnings rather than relying solely on profit growth.
What Could Go Wrong for SGX?
In the near term, SGX’s revenue remains tied to market sentiment and daily traded volumes.
Offering more asset classes can help soften the blow when things slow down, but when the market stays quiet for a while, the cash equities clearing fees always take a hit.
At the same time, SGX isn’t the only game in town.
Global and regional rivals are all fighting hard to attract international listings.
If trading volumes don’t bounce back quickly or if new market initiatives take longer than planned to attract fresh liquidity, the share price could take a real hit.
Conclusion – Get Smart: Is SGX Still Worth Buying?
SGX remains a strong business with a dominant market moat and expanding multi-asset momentum.
Yet after a sharp rally, its operational strength looks fully priced in.
Even an outstanding company makes a poor investment when bought at too high a valuation.
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Disclosure: Joseph G. does not own shares of any companies mentioned.
