BSE share price surged nearly 10%, hitting an all-time high, following the introduction of a new regulatory framework by the Securities and Exchange Board of India (SEBI) to oversee the F&O market, which was perceived to be less stringent than expected. On Tuesday evening, SEBI released a set of six new guidelines that included restricting the weekly expiration of index futures and collecting premiums upfront. Between November 2024 and April 2025, these six rules will go into effect.
The 2% increase in expiry-day margins, as opposed to the 8% suggestion, and the 2-3x increase in lot size, as opposed to the 3–4x proposal before, are two significant differences.
BSE share price today opened at ₹3,800 apiece on NSE, the stock touched an intrday high of ₹4,235 per share, and an intraday low of ₹3,745.05. According to Ruchit Jain, Lead Research Analyst at 5paisa, BSE share price is forming a higher top higher bottom structure and is this in an uptrend. The upmove is also supported by good volumes and hence the momentum is likely to continue.
Following the announcement of SEBI's new framework, brokerage house, Motilal Oswal Financial Services in its report has maintained a ‘Neutral’ rating on BSE.
According to the brokerage's analysis, if the derivative volumes drop by 20% instead of the 22% growth that was projected, the impact on BSE earnings would be minimal and the premium to notional turnover ratio would rise from 0.072% to 0.09%.
Global stockbroker Jefferies, however, noted in its analysis that it believes that as system premiums decline, retail-focused discount brokers and exchanges (BSE) will be most impacted. Following the introduction of new regulations, forBSE the globalbrokerage has reduced its EPS by about 10%, assuming the discontinuation of the Bankex product. The focus will continue to be on the volume impact on the ongoing product (Sensex).
According to experts, the move by SEBI to increase the minimum contract size, remove calendar spreads on expiry days, rationalise weekly index derivatives products and ensure that they are appropriate and suitable for participants, as well as to curtail excessive and overly speculative trading on expiry days, particularly by ignorant retail players with limited knowledge of F&O, was largely anticipated by market participants in the grand scheme of things.
“SEBI steps to revise the minimum derivative contract value to ₹15 lakhs and mandated the upfront collection of option premiums from buyers, along with other measures won’t change market direction but this can bring in informed players with calculated risk of trading and investing in markets,” said Prashanth Tapse, Senior Vice President of Research at Mehta Equities.
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