Galaxy Entertainment Added to Hang Seng Index, Esprit RemovedKana Nishizawa and Zijing Wu
Galaxy Entertainment Group Ltd., the Macau casino owner that doubled profit last year, will be added to Hong Kong’s benchmark Hang Seng Index effective June 17, the compiler of the gauge said today.
Esprit Holdings Ltd. will be removed, according to a statement from Hang Seng Indexes Co. The number of members will remain at 50, it said. Galaxy has a market capitalization of HK$159.9 billion ($20.6 billion) while Esprit is valued at HK$19.97 billion.
The Hang Seng Index has risen 0.3 percent to 23,321.22 since its last quarterly review on Feb. 6, when the index compiler said Lenovo Group Ltd. will be added and Aluminum Corp. of China Ltd. will be removed. Lenovo, the world’s No. 2 personal computer maker, has since tumbled 19 percent, while Aluminum Corp. of China slid 11 percent.
The changes announced today may impact the share moves of the added or removed companies, as Hang Seng Index-tracked funds such as the Hang Seng Index Exchange-Traded Fund, with a total asset value of HK$35.3 billion ($4.55 billion) as of May, adjust their holdings.
Galaxy Entertainment surged 15 percent since Hang Seng Index’s last quarterly review, as increasing number of Chinese gamblers to Macau drove its profit higher. The shares rose to a record high this week after announcing a plan to buy a casino hotel on Macau’s increasingly popular Cotai strip.
Esprit, the Hong Kong-based apparel seller whose two top executives quit last year, this week forecast a “substantial” fiscal-year loss on store closures and loss of goodwill.