In Wednesday's trading, BSE shares increased 8% following the Sebi's proposal of seven steps to curb retail derivatives speculation. On the BSE, the stock increased 8.10% to a peak of Rs 2,607.70. IIFL Securities, a domestic brokerage, stated that BSE trades at 26 times FY26 EPS. In the event that the Sebi's recommendations are carried out and a 25% earnings decrease is assumed, the company would trade at 34 times.
"After adjustment, BSE's earnings are projected to grow at a compound annual rate of 15% over FY26–28. We believe the stock will bottom out at 30 times the revised EPS for FY26 (about Rs 70). We are continuing to use our base estimates while we wait for the final regulations to become clear," IIFL stated.
Regarding the effect on earnings, NSE is projected to see a greater impact because options account for 60% of its estimated revenues in FY25, compared to 40% for BSE.
According to IIFL Securities, BSE's FY26 earnings would be impacted by 15–18%, compared to 25–30% for NSE. Due to their reliance on retail investors, discount brokers are expected to be more affected within the value chain than full-service brokers.
BSE would be more affected by a separate consultation paper on return of interest income on margin money (10%) than NSE (4%) according to IIFL Securities.
"Our estimates of the earnings impact are based on preliminary analysis, which we will adjust as additional information about the expected effects of suggested actions becomes available," the brokerage stated.
