BSE (BSE IN) – Company Update – Regulatory pressure to weigh on growth – BUY
Published on 21 Aug 2026
Industry derivative volumes for Aug’26 have contracted by ~6% MoM due to the implementation of CAS. Moreover, stricter bank guarantee norms and the hike on STT in the F&O segment has slowed down overall industry growth. While BSE continues to maintain a strong market share in index options at 35%, it is seeing a lower run-rate. We factor the same into our FY27/ FY28E growth estimates (at 23%/ 20% YoY) for index options. We cut our FY27/ FY28E PAT estimates by 2%-6% and reduce our multiple to 43x on FY28E PAT vs. 49x earlier. Sensitivity analysis shows an impact of 1%-2% on FY27/ FY28E PAT if NSE does not list on BSE. Stock has corrected ~12% over the past month on the impact of regulatory headwinds. Maintain BUY with a TP of INR4,025.
