The brokerage firm, Nuvama Institutional Equities, slashed the target price on BSE by almost 30% to Rs 5,160 from Rs 7,250. The cut in target price came after NSE shifted its index option expiry day to Monday from Thursday, a day ahead of Sensex’s index option expiry.
It also cut the net profit estimates by 13% for FY26 and 11.6% for FY27. This further translates to an earnings per share compounded annual growth rate of 17.1% for FY25-27.
NSE’s action will lower trading volumes
The NSE’s action of changing expiry to a different day would lower volumes for the industry as trading avenues for retail traders, who are typically more active closer to expiry, will reduce. This move is likely to help NSE reclaim its previous market share of 83.6%, which it had in December 2024. There was a substantial jump in BSE’s premium turnover in January 2025 compared to April to October 2024, BSE moved its option expiry. However, with NSE moving expiry day just one day ahead of BSE, it is likely to reduce BSE’s market share. “We expect this would moderate BSE’s market share to 18% from the recent 22% observed in February 2025,” said Nuvama Institutional Equities.
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SEBI’s consultation paper on derivative exposure limits may clip growth, said Nuvama. SEBI’s consultation paper proposes a shift to a delta-based open interest (OI) calculation. Plus, a new set of rules to reduce artificial ban triggers in single stock derivatives (SSDs) and changes in participant limits for index derivatives. “We believe the articulated measures for SSDs will be positive. However, the move to change the method of calculation and OI limits for index derivatives, if implemented in current form, may hurt volumes,” Nuvama said.
BSE’s performance in Q3
The company reported robust third quarter numbers as its net profit soared 104% year-on-year to Rs 220 crore in the third quarter of FY25. The company’s revenue from operations jumped 108% YoY to Rs 773 crore in Q3 FY25.
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The share price of BSE has fallen 11% in the past five trading days.
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