[Summary]
Our view on Japan Exchange Group is currently neutral. In the fiscal year ending March 2026, operating revenue increased 22.5% year on year to 198,735 million yen, operating profit increased 29.0% year on year to 116,289 million yen, and profit attributable to owners of the parent company increased 29.5% year on year to 79,139 million yen. In addition to active buying and selling in the Japanese stock market, increases in revenue related to collateral management of interest rate swap transactions and revenue related to listing and information services contributed to the increase. On the other hand, the company's forecast for the fiscal year ending March 2027 is for an increase in sales but a slight decline in operating profit, and the focus on the stock price is whether it can maintain the market-dependent tailwind and whether it can expand its revenue sources through interest rates, data, and new products.
Overview
Japan Exchange Group is a market infrastructure company that includes the Tokyo Stock Exchange, Osaka Exchange, Tokyo Commodity Exchange, Japan Securities Clearing Corporation, and JPX Research Institute.
The main sources of revenue are cash and derivatives trading, clearing, listing, information, and system usage fees.
In the fiscal year ending March 2026, an increase in trading value in the Japanese stock market and growth in clearing-related income pushed up the overall outlook.
Sales: 198,735 million yen Operating income: 116,289 million yen Final profit: 79,139 million yen YoY: Increase in sales and profit
It was a year that benefited greatly from the market boom, but at the same time, we also made progress in expanding interest rates, data, and new products.
Financial Highlights (Simple Table)
| Indicators | Contents |
|---|---|
| Sales | 198,735 million yen, 22.5% increase compared to the previous year |
| Operating income | 116,289 million yen, 29.0% increase |
| Final profit | 79,139 million yen, 29.5% increase |
| Factor 1 | Transaction-related revenue increased by 20.0% due to increase in spot trading value |
| Factor 2 | 57.5% increase in clearing-related revenue related to collateral management of interest rate swap transactions |
Operating profit margin rose to 58.5%, and ROE also reached 23.1%.
What happened (most important)
Quantity
In terms of volume, the spot market has expanded the most.
The average daily trading value of stock certificates, etc. in FY2025 was 7.52 trillion yen, an increase of 31.9% from the previous year. Prime market domestic stocks also increased by 30.0% to 5.74 trillion yen.
Transaction-related revenue was 77,399 million yen, an increase of 20.0% from the previous fiscal year. Spot trading fees increased 28.2% year on year to 55,265 million yen, boosting overall trading-related revenue.
On the other hand, sales of financial derivatives were a little weak for the full year, with transaction fees down 1.0% from the previous quarter. Nikkei 225 futures decreased, while Nikkei 225 options increased by 22.5%.
In clearing-related areas, collateral management income from interest rate swap transactions increased significantly. This is not just a tailwind from stock trading, but also includes a structural factor such as the expansion of interest rate-related services.
price
The price of JPX needs to be viewed not as a simple unit price revision like a retail company's price increase, but as an accumulation of listing fees, information provision fees, and system usage fees.
In the fiscal year ending March 2026, listing-related revenue was 18,682 million yen, an increase of 7.9% from the previous fiscal year. This is due to increases in both new and additional listing fees and annual listing fees.
In addition, the supplementary materials show that information-related revenue increased by over 1.7 billion yen from the previous year, and data service revenue increased by 11% from the previous year to 3.5 billion yen. In addition to market buying and selling, income from selling information itself is gradually increasing.
Cost
Operating expenses were 83,598 million yen, an increase of 11.4% from the previous fiscal year.
The main reason was that other operating expenses increased significantly due to an increase in the amount returned to clearing participants due to collateral management such as interest rate swap transactions. In other words, while the expansion of clearing-related revenue is a factor pushing up profits, the corresponding costs also increase at the same time.
Even so, operating income increased by 29.0%, with the increase in revenue more than absorbing the increase in costs.
Exchange
Because JPX's focus is on domestic market infrastructure, it does not have a structure in which currency exchange rates directly affect gross sales profits, unlike in the manufacturing industry.
However, exchange rates are indirectly important. On April 13, 2026, currency futures for the dollar/yen, euro/yen, and offshore renminbi/yen were listed on the Osaka Exchange, and the greater the exchange rate fluctuations, the more likely there is to be demand for hedging and room to expand the use of new products.
For this company, rather than seeing foreign exchange as a direct factor, it is closer to the reality that it is viewed as an external factor that works through market activation and product demand.
Separating structural and temporary factors
The increase in profit for the fiscal year ending March 2026 was largely due to market factors such as an increase in Japanese stock trading value. Depending on the situation, there could be a backlash.
On the other hand, the expansion of interest rate swap-related revenue, increase in data service revenue, addition of new products such as currency futures, and progress in information services that utilize AI are structural factors that will lead to diversification of the revenue base.
When looking at stock prices, it is important not only to see market activity, but also to what extent these structural factors will become entrenched.
Latest materials (3 months)
On April 13, 2026, the Osaka Exchange listed currency futures, Pocket Gold 100 futures, and Pocket Platinum 100 futures. This is a move to widen the range of derivatives, and it is a sign that there is room for earnings expansion in areas other than Japanese stocks.
On April 28, 2026, the company announced its full-year financial results for the fiscal year ending March 2026, supplementary materials for the fiscal year 2025 financial results, an update to the medium-term management plan 2027 for fiscal year 2026, and the decision to acquire treasury stock on the same day. The maximum number of share buybacks is 40 million shares, the total amount of share purchase is up to 20 billion yen, and the acquisition period is from June 1, 2026 to October 26, 2026, which can be said to be designed with capital efficiency and return policy in mind.
On the same day, April 28, progress in AI utilization was also announced. We are expanding services that help people search and understand disclosed information, such as J-LENS, JPX Market Explorer, and JPxData Portal. Internally, the use of AI has shown an average reduction in work by approximately 12 hours per month per person.
On May 1, 2026, the trading status for April was announced, and the average daily trading value of domestic common stocks on the TSE prime market was 8,903.1 billion yen, the ETF market was 465.7 billion yen, and the total trading value of derivatives was 293 trillion yen. This data shows that the high level for the full year of FY2025 has continued into the beginning of the fiscal year, and can be seen as a tailwind for trading-related profits in the short term.
Furthermore, at the time of writing this article, we have not been able to sufficiently confirm secondary data that quantitatively shows the stock price reaction after the announcement of financial results. Therefore, current market evaluations need to be viewed from a combination of sales and sales statistics and company disclosures.
Business structure
Source of revenue
JPX has six main sources of revenue.
Key point Key point Key point Key point Key point Key point
In the fiscal year ending March 2026, transaction-related revenue of 77,399 million yen and clearing-related revenue of 54,242 million yen were the core. In other words, current profits are supported by stock/derivative buying and selling and post-trade functions.
Profit margin
Operating profit margin is extremely high at 58.5%.
Market infrastructure has a strong fixed-cost nature, and profit margins tend to increase when buying and selling and data demand increases. Therefore, profits tend to increase significantly in years when trading volume is strong.
Strengths
Its strength is clear: it is the core infrastructure of the domestic capital market.
Because it has the TSE, OSE, TOCOM, and JSCC, and handles everything from trading, clearing, listing, and information provision, it has a broader source of income than a single product company. In addition, the existing market is deep, with ETF net assets exceeding 100 trillion yen and interest rate swap clearing expanding.
Weaknesses
The weakness is that it remains highly sensitive to market conditions.
If physical trading prices subside, trading-related profits will slow down. Furthermore, since the company is a highly profitable company, system failures and market system changes can have a large impact on its credibility.
Implications for stock prices
Positive
In the fiscal year ending March 2026, sales and profits will increase, and both profitability and capital efficiency are strong, with an operating profit margin of 58.5% and ROE of 23.1%.
Furthermore, the annual dividend for the fiscal year ending March 2026 was 61 yen, and the company's forecast for the fiscal year ending March 2027 is unchanged at 61 yen. In addition, the company has decided to buy back up to 20 billion yen of treasury stock on April 28, 2026, and its stance on giving back is clear.
Negative
On the other hand, the company's forecast for the fiscal year ending March 2027 is that operating revenue is expected to increase to 205 billion yen, but operating profit is expected to be 115 billion yen, a decrease of 1.1% from the previous fiscal year, and profit attributable to owners of the parent company is expected to be 77.5 billion yen, a decrease of 2.1% from the previous fiscal year.
The next issue to be discussed is whether they can maintain profit levels while absorbing the backlash from market activity and the burden of investment.
Weaving
When the market evaluates this company, it is important to consider not only the sales activity in a single year, but also the extent to which contributions from interest rates, data, systems, and new products can be viewed as sustainable profits.
The sales statistics for April are strong, but if you factor in the assumption that they will continue throughout the year, the evaluation tends to become a little unstable.
Gap
The future gap lies not in whether Japanese stock trading value remains high, but in whether the ratio of non-stock and non-single profits increases.
If currency futures, interest rate swap-related services, data services, and AI-based services can increase their contribution to profits, this will likely be seen as a reduction in market dependence. On the other hand, if growth slows down after the tailwind in trading value has run its course, the outlook for business results is likely to change.
Short term (6 months)
There are three points to note in the short term.
The first is whether the monthly trading situation can be maintained at the same high level as in April. 2Key point The third question is whether interest rate-related and data-related growth continues to be confirmed in the quarterly financial results from summer onwards.
In the short term, Japan's stock market sentiment and progress in shareholder return policies are likely to support stock prices.
Mid-term (1 year)
In the medium term, as the second year of the medium-term management plan 2027, the focus will be on how far the company will progress in diversifying its revenue base.
The company aims to evolve into a global comprehensive financial and information platform. In addition to the strength of the cash market, the mid-term evaluation axis will be based on interest rate-related products and services, data and digital services, the use of AI, and the development of new asset classes.
In the fiscal year ending March 2026, data service revenue rose to 3.5 billion yen and interest-related revenue rose to 20.9 billion yen. If this trend continues into next fiscal year and beyond, it will lead to further easing of market dependence.
Scenario analysis
Bullish: 30% If trading value continues to be at a high level and interest rate-related, data-related, and new products increase, expectations for stable business growth will increase and stock prices will tend to rise.
Neutral: 50% The liveliness of the spot market will calm down a bit, but if the return policy and core earnings are supported, stock prices will likely remain within a range without falling significantly.
Bearish: 20% If trading value slows down more than expected and non-trading revenue growth cannot keep up, expectations for increased profits will decline and stock prices will likely adjust.
Risk (simple table)
| Risk | Contents |
|---|---|
| Market Conditions | Trading-related revenue decreases due to slowdown in stock trading value and derivative trading volume |
| Systems/Regulations | Changes in listing system and clearing system affect profit structure |
| System | Core system failures and troubles affect both credibility and business performance |
| New business | Monetization of currency futures and data/AI-related services may be slower than expected |
| Interest rate related | Possibility of flattening out of revenue growth related to interest rate swap collateral management |
Summary
Japan Exchange Group's profits increased significantly in the fiscal year ending March 2026, driven by the boom in the Japanese stock market. In particular, there was a large increase in physical trading value and clearing-related income.
On the other hand, the next thing investors should look at is how far non-traditional revenue sources such as interest rate-related, data, AI, and new products can be expanded, even though profits are expected to decline slightly in the fiscal year ending March 2027.
In the short term, the monthly trading status and the progress of share buybacks. In the medium term, the focus will be on revenue diversification. The turning point in evaluation is whether a company can be reconsidered not only as a company with a booming market, but also as a company expanding market infrastructure.
File name
2026-05-04-japan-exchange-group-analysis.md