Continuing its upward trajectory, shares of BSE, one of Asia’s oldest stock exchanges, marked a third consecutive session of gains on Monday, surging by 9.21% to ₹2,321 apiece. The stock reached a new peak of ₹2,350 during the session, witnessing an 18.23% gain over the last three trading sessions.
Over the last six months, BSE shares have shown significant growth, recording a substantial gain of 333%, rising from ₹430.95 apiece to ₹1,863, driven by notable market share gains. In the current month alone, the shares have rallied by 24.63%. Notably, from the March 2023 low of ₹406.20 apiece, the stock has witnessed an extraordinary surge of 471.39% to date.
The robust performance of BSE in the September quarter (Q2FY24) is highlighted by a net profit growth of 307%, reaching ₹118.4 crore compared to ₹29 crore in the same period last year. The company reported its highest quarterly revenue of ₹367 crore in Q2FY24, reflecting a growth of 53%. Operational revenues also saw a significant increase, rising by 59% to ₹314.5 crore.
The average daily turnover in the equity cash segment for Q2FY24 reached ₹5,922 crore, up from ₹4,740 crore in the corresponding quarter last year. In the equity derivatives segment, BSE achieved a milestone by trading over 27 crore contracts, representing a notional turnover of ₹177 lakh crores on November 10, 2023, as per the company’s earnings report.
HDFC Securities, a domestic brokerage firm, highlighted BSE’s impressive market share gain in the derivatives segment and its pricing reset, improving revenue visibility with better profitability. The firm pointed out that BSE is well-positioned to capture a share of the large options market in India.
With the recent price hike in derivatives effective from November 23, BSE’s pricing is at a 26% discount to NSE, leaving room for further hikes. HDFC Securities expects BSE to maintain a premium market share of 10% in FY26E, with derivatives contributing 40% of total revenue and 53% of EBITDA.
The brokerage maintained its ‘buy’ rating on the stock and assigned a SoTP-based target price of ₹2,400 apiece, expecting a revenue and EPS CAGR of 35% and 42% over FY23–26E.
In conclusion, the question remains whether BSE, with its remarkable performance, is still a ‘buy’ for investors.
