BSE shares climb 8% after Sebi F&O proposals; what IIFL Securities say

Shares of BSE climbed 8 per cent in Wednesday's trade after the Sebi proposed seven measures to cub retail speculation in derivatives. The stock climbed 8.10 per cent to hit a high of Rs 2,607.70 on NSE. Domestic brokerage IIFL Securities said BSE trades at 26 times FY26 EPS. Assuming a 25 per cent earnings cut, if the Sebi's proposals are implemented, the stock would trade at 34 times.

"Post revision, BSE’ earnings are likely to compound at 15 per cent compounded annually over FY26-28. We assume stock should bottom out at 30 times FY26 revised EPS (Rs 70). As of now we maintain our base estimates and await clarity on final regulations," IIFL said.

In terms of earnings impact, it sees higher impact for NSE as options accounts for 60 per centof its expected revenues in FY25, while for BSE it is 40 per cent.

IIFL Securities sees a 15-18 per cent impact on BSE's FY26 earnings against 25-30 per cent for NSE. Within the value chain – discount brokers are likely to be more impacted than traditional full service brokers given former’s dependence on retail investors, it said.

A separate consultation paper on return of interest income on margin money will have a higher impact on BSE (10 per cent) compared to NSE (4 per cent), IIFL Securities said.

"Our earnings impact calculations are based on initial assessment which we would fine tune as more clarity emerge on the likely impact of proposed measures, the brokerage said.