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BSE
Our verdict on BSE isn’t the consensus take — see where we landed, and the one risk the bull case glosses over.
See the verdict — free →Does management do what it says?
BSE continues to list these as key growth drivers for its existing business, indicating ongoing expansion of these e-platforms. (1 in progress across 1 tracked commitment)
“Expansion of services from current e-platforms like book-building for IPO, Offer to Buy, Offer for Sell, New Bond platform, etc.”
Having reached the threshold of 150 crores and maintaining a comfortable SGF position, management has lowered the voluntary contribution rate from 5% to 3.5% of profits to optimize the P&L. (1 revised across 1 tracked commitment)
“We have crossed it, and in that situation, we are reducing the contribution requirement per quarter from 5% to 3.5%.”
BSE intends to start developing and launching commodity derivatives products. — target: Launch commodity derivatives (+1 more commitment)
“Now that we feel that we have made some headway, though there is a long way to go further, we will be starting to think on commodity derivatives... our sincere wish is that very soon we should be able to come out with consolidated views, taking up with the regulators and taking the commodity agenda forward.”
BSE is preparing to implement a new closing auction session as directed by SEBI. — target: Implementation of closing auction session
“On the regulatory front, SEBI directed exchanges to introduce a closing auction session to be implemented from 3rd August 2026, replacing the existing methodology of determining closing prices... BSE is preparing to implement the changes to ensure a smooth transition for all market participants.”
Management targets increasing the number of brokers trading SENSEX options to at least 700. — target: 700 brokers (+1 more commitment)
“In terms of brokers, if we see, while our stated goal for this year is we should go at least 600, 700. 600 appears to have been achieved by now already. So, at least 700 is what is the goal.”
See the full cited Management analysis of BSE
How durable is the business?
The network effect is strengthening as registered investor accounts surpassed 24 crores and the SME platform reached a milestone of 700 listings, with the last 100 added in record time. (1 expanding)
“BSE's SME platform achieved a significant milestone with the successful listing of its 700th SME company on February 1, 2026. The pace of listings has accelerated meaningfully with the most recent tranche of 100 companies added within a span of just 179 days”
Revenue from services to corporates (listing fees) is expanding, showing resilience and growth despite market volatility, supported by a strong IPO and book-building pipeline. (3 expanding across 1 engine)
“Listing Services Mar’26 Quarter 1,188; YoY -5%”
BSE is successfully shifting its derivatives mix; while weekly expiries dominate, non-weekly (monthly and next-week) volumes now contribute 5% of total volumes, up from zero. (1 shifted)
“Earlier we were nothing there in the next week and next to next week. Today we are very proud to say including the monthly, other than the current week, total volumes of around of our 5% comes from that.”
Treasury income saw a contraction of 27% YoY, reflecting a decrease in income from clearing and settlement operations. (5 contracting across 1 engine)
“Treasury Income on Clearing and Settlement Funds Mar’26 Quarter 403; YoY -9%”
Transaction Charges: Fees earned from trading activity in equity, derivatives, and other segments, which saw massive growth due to increased market participation. — Transaction Charges (83.8% revenue share)
“Transaction Charges Mar’26 Quarter 13,110; YoY 114%”
See the full cited Business Model analysis of BSE
Where does growth come from?
The index business is expanding rapidly through product innovation, launching 32 new indices in 16 months and reaching Rs. 2.54 lakh crores in AUM. (2 accelerating, 3 new trend across 5 signals)
“Sustained growth: 100% increase in Revenue from core Index Operations”
The SME platform is accelerating significantly, crossing 600 total listings with a record-breaking July 2025 where 18 new listings raised Rs. 880 crores. (4 accelerating, 1 steady across 5 signals)
“SME Listings ... SME IPO No. of IPO ... FY26 62”
The IPO market remains exceptionally vibrant, with 97 new listings in Q2 and a strong performance continuing into October 2025. (2 steady across 2 signals)
“As we enter FY27, the IPO pipeline remains robust, with more than 250 active applications to raise Rs. 1.75 lakh crores, reinforcing our position as a leading global fundraising venue.”
BSE has increased its market share in the cash equity segment, though it remains below its long-term double-digit target.
“Market share in equities has been hovering around 7% to 8% compared to 5% to 6% when I joined. This is far away from what we wanted it to be. We wanted it to be at least double digit.”
BSE is expanding its reach into the international market through its presence in GIFT City, offering dollar-denominated products to global investors. — India INX Global Access Trades: Steady growth
“Access to 135+ global exchanges and products across the US, Asia-Pacific and Europe, via a single integrated terminal”
See the full cited Future Growth analysis of BSE
What could break the thesis?
Capital expenditure (Work in Progress) reached a significant Rs. 313 crores in six months. Management attributes this to the need for physical and technology infrastructure to cope with rapid growth. (4 intensifying, 1 easing)
“Technology expenses ... FY 2026 2,031 ... YoY 24%”
Treasury income from clearing and settlement funds decreased by 32% to Rs. 42 crores from Rs. 63 crores, confirming the vulnerability of this revenue stream. (4 intensifying, 1 easing)
“Treasury Income on Clearing and Settlement Funds ... FY 2026 1,714 ... YoY -21%”
The risk is currently easing as the IPO market is 'exceptionally vibrant.' BSE saw 21 new equity listings in Q1 and a record 18 SME listings in July 2025 alone, indicating a strong pipeline. (4 easing)
“Listing Related Income (₹ million) ... FY26 3,811”
The risk is INTENSIFYING as transaction charges now constitute 70.6% of total consolidated income (Rs. 7,375 Mn out of Rs. 10,445 Mn) in Q1 FY26, up from 59.9% in Q1 FY25. This indicates a higher concentration of revenue in market-sensitive trading activity. (4 intensifying)
“Transaction Charges: Jun’25 Quarter 7,375; Total Income: Jun’25 Quarter 10,445”
Regulatory contributions have surged 58% year-on-year, growing faster than total operating expenses (24%), which structurally pressures the bottom line. (1 intensifying)
“Regulatory Contribution 6,497 [FY26] vs 4,105 [FY25] YoY 58%”
See the full cited Risk analysis of BSE
BSE analysis by filing period
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