The downgrade follows BSE’s announcement of a change within the expiry day for its weekly Sensex contracts—from uesday to Thursday—efficient September 1, 2025. In line with Motilal Oswal, the shift is anticipated to influence BSE’s premium turnover market share, which stood at 22.6% in Might 2025.
“We word that this shift will result in a loss in market share for BSE when it comes to premium turnover, which stood at 22.6% in Might ’25,” the brokerage stated.
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At the moment, every buying and selling day accounts for 18–22% of the week’s complete premium quantity. BSE holds a market share of 8% on Wednesdays and Thursdays, and 21%, 24%, and 38% on Fridays, Mondays, and Tuesdays, respectively. “Overlaying the present traits on the day-wise quantity share for the week, we count on a market share lack of 350–400 foundation factors for BSE,” Motilal Oswal stated.
The brokerage has additionally lowered its premium common each day turnover (ADTO) estimates for FY26/FY27 to Rs 137 billion and Rs 157 billion, respectively, down from Rs 155 billion and Rs 190 billion earlier. This ends in a 9%/12% lower to its FY26/FY27 earnings estimates.
“With the latest rally, the inventory trades at a FY27E P/E of 53x—considerably larger than each its historic common and that of worldwide friends,” the brokerage famous. It maintained its revised goal value of Rs 2,300, valuing the inventory at 45x FY27E P/E.
Motilal Oswal additional defined that because the implementation of latest F&O laws in March 2025, every buying and selling day has contributed 18–22% to the week’s premium turnover. BSE’s common market share stood at simply 8% on Wednesdays and Thursdays, with stronger efficiency on different days. “Assuming latest traits persist and making use of them to the day-wise trade quantity distribution, we estimate BSE’s market share might decline to 18–19% from 22.6% in Might 2025,” it added.
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The influence of the expiry shift is anticipated to change into seen from September 2025, when the brand new contracts take impact.
Regardless of earlier regulatory modifications launched by SEBI since November 2024—together with limiting weekly expiries to only one index per trade and growing the lot dimension of index derivatives—BSE’s volumes had strengthened. Premium turnover ADTO rose from Rs 90 billion in October 2024 to Rs 159 billion in Might 2025, supported by larger volumes on non-expiry days and the addition of over 100 colocation racks in March 2025.
BSE additionally reported a powerful efficiency in This autumn FY25, with income and PAT rising 75% and 366% year-on-year, respectively, even because the broader capital markets confronted a weak quarter. This efficiency led to upgrades in earnings estimates and a subsequent re-rating of the inventory.
Following Motilal Oswal’s downgrade, BSE shares fell as a lot as 6.15% to Rs 2,500 throughout Wednesday’s commerce on NSE.
(Disclaimer: Suggestions, recommendations, views, and opinions given by the consultants are their very own. These don’t signify the views of The Financial Instances)
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