BSE share price jumps 18%, gains for 2nd day as NSE defers plan to change weekly expiry day

Shares of BSE rallied 18 per cent on Friday, March 28, to ₹5,519 after the stock market regulator Securities and Exchange Board of India (SEBI) proposed restricting the derivatives expiry schedule, which prompted its rival National Stock Exchange (NSE) to defer its plan to tweak the weekly expiry day. Analysts believe this would help prevent potential market share losses for BSE.

Additionally, the company's board is also slated to meet on March 30 to consider bonus share allotment. Today was the second day of gains for BSE shares as it jumped 5 per cent on Thursday, taking the two-day rally to 23%.

SEBI’s Expiry Proposal Favors BSE

SEBI, on March 27, issued a consultation paper which proposes restricting equity derivative contract expiries on any exchange to either Tuesday or Thursday. This aims to promote ideal spacing of expiry days, reduce concentration risk, and encourage product innovation.

Currently, BSE’s equity derivative contracts expire on Tuesday, while NSE had planned to shift its expiry to Monday from April 2025, which it has now deferred indefinitely.

Analysts believe that the proposed SEBI regulation would prevent a volume loss for BSE by ensuring that NSE cannot adopt a Monday expiry. This would leave Tuesday and Thursday as the only viable expiry days, effectively maintaining BSE’s market share and protecting it from NSE’s influence.

Brokerage Views on BSE

Leading brokerage firm Jefferies reiterated its HOLD rating on the stock, pegging the BSE share price target at ₹5,250, indicating a potential 12 per cent upside from the current market price of ₹4,694 on March 27.

Jefferies believes that SEBI’s expiry day proposal could mitigate concerns over BSE’s market share loss, which was previously estimated to impact earnings per share (EPS) by 12 per cent. The brokerage also noted that while clarity on open interest limits is still awaited, the impact on BSE is expected to be minimal.

Jefferies identified two key factors that could support a re-rating of BSE shares:

• BSE shares have recovered most of their previous losses.
• Lower regulatory risks and improved market conditions could remove the overhang on the stock.

Meanwhile, Motilal Oswal Financial Services (MOSL) maintained a positive outlook on BSE, highlighting that the proposed SEBI changes could sustain BSE’s growth trajectory. With BSE’s expiry ahead of NSE, the benefit of time decay in options trading would remain intact, supporting its market share gains. MOSL added that while the consultation paper’s proposal on entity-level limits poses a potential risk, the overall regulatory changes are likely to be beneficial for BSE.

BSE Board to Consider Bonus Shares

Additionally, BSE’s board will convene on March 30 to evaluate the issuance of bonus shares, which are additional fully paid-up shares granted to existing shareholders at no extra cost. Companies typically issue bonus shares to enhance stock liquidity and reduce the share price, making it more accessible to retail investors. In line with regulatory norms, BSE announced that its trading window will remain closed for securities transactions from March 26, 2025, to April 1, 2025, covering both dates.

Stock Price Trend

BSE share price rallied 10 per cent to its day's high of ₹5,152.75. In just two sessions, the scrip has soared over 15 per cent. In the last one year, the stock has climbed over 90 per cent. Moreover, just in March, it advanced 13 per cent following a 13 per cent fall in February.

Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before making any investment decisions.