BSE shares drop 2% despite 'strong' Q1 results; what's spooking analysts?

BSE shares fell as analysts cautioned that its derivatives market share will likely take a hit after the swap in expiry dates

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Shares of Asia's oldest bourse, BSE Ltd., fell over 2 per cent despite strong June quarter results, as analysts warned that it will likely lose derivatives market share from the expiry day swap. 

 

The stock exchange's stock fell as much as 2.34 per cent during the day to ₹2,385 per share. The stock pared losses to trade 2.1 per cent lower at ₹2,388 apiece, compared to a 0.4 per cent advance in Nifty 50 as of 9:43 AM.   Track LIVE Stock Market Updates Here

BSE Q1 results 

The bourse reported a 103.4 per cent year-on-year (Y-o-Y) rise in net profit to ₹539 crore for the first quarter of the financial year 2026 (Q1FY26), compared with ₹265 crore in the same period last year. Sequentially, net profit was up 9.1 per cent.

 

Revenue from operations rose 57.1 per cent to ₹958 crore from ₹610 crore in the corresponding quarter of the previous fiscal.

 

At the operating level, Ebitda surged 104.7 per cent to ₹704 crore from ₹344 crore in Q1FY25, while the Ebitda margin expanded sharply to 73.56 per cent from 57.19 per cent a year ago.

 

Nuvama Institutional Equities said BSE reported "strong showing" with Q1FY26 index options average daily premium turnover (ADPTV) market share rising to 23.8 per cent, driving the increase in top line. 

 

Cash market average daily turnover (ADTO) fell 20 per cent Y-o-Y to ₹7,200 crore amid a challenging market environment, while options premium ADTO hit a new peak of ₹15,100 crore in the first quarter, driven by increased activity on non-expiry days. 

Why did BSE stock fall?

Analysts remained cautious on the derivatives market share as BSE will likely take a hit after the swap in F&O expiry dates from September 2025. The Securities and Exchange Board of India (Sebi) permitted derivatives contracts on the NSE to expire on Tuesdays, from the current Thursday expiry. Later, BSE moved to shift its expiry to Thursday, from the current Tuesday. 

 

Nuvama noted that July 2025 ADPTV declined 10.2 per cent month-on-month (M-o-M) due to lower implied volatilities. It expects the expiry swap to lead to a drop in BSE’s ADPTV and premium-to-notional turnover. Accordingly, it cut FY26, FY27 and FY28 adjusted profit estimates by 3.1 per cent, 6.2 per cent and 6 per cent, respectively.

 

Meanwhile, Nuvama raised its target price to ₹2,820 from ₹2,770, and maintained a 'Buy' on the stock. 

 

Analysts at Motilal Oswal expect BSE to lose 300-400 bps of premium turnover market share once the weekly expiry shifts to Thursday from Tuesday currently. "Any further regulatory moves to curb retail activity in F&O can impact volumes for the exchange."

 

Motilal Oswal retained its 'Buy' call with a target price of ₹2,600 per share.  

BSE share price history

Shares of the company snapped a two-day gaining streak and currently trade at 2.3 times the average 30-day trading volume, according to Bloomberg. The counter has risen 36 per cent this year, compared to a 4 per cent advance in the benchmark Nifty 50. BSE has a total market capitalisation of ₹97,326.68 crore.