BSE shares jumped nearly 10%, reaching a record high after the Securities and Exchange Board of India (SEBI) introduced new rules for the futures and options (F&O) market. The regulations were seen as less strict than many had anticipated. On Tuesday, SEBI announced six new guidelines, including limiting weekly index futures expirations and requiring upfront premium payments. These changes will take effect between November 2024 and April 2025.
Two notable adjustments are a 2% increase in expiry-day margins instead of the previously suggested 8%, and a smaller increase in lot sizes—2-3 times instead of the 3-4 times proposed earlier.
On the NSE, BSE shares opened at ₹3,800 and hit an intraday high of ₹4,235, with a low of ₹3,745.05. Ruchit Jain, a Lead Research Analyst at 5paisa, noted that the stock is in an upward trend, forming a pattern of higher highs and lows, supported by strong trading volumes, suggesting that momentum will likely continue.
In response to the new framework, Motilal Oswal Financial Services has kept a ‘Neutral’ rating on BSE. Their analysis indicates that even if derivative volumes drop by 20% instead of the previously expected 22% growth, the impact on BSE’s earnings would be minimal. They also expect the premium to notional turnover ratio to rise from 0.072% to 0.09%.
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