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Informist, Thursday, Aug. 7, 2025

 

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--BSE: Charges by co remains lower than competition 
--BSE: Saw higher activity from investors on non-expiry days in Apr-Jun 
--CONTEXT: BSE managment's comments in post-earnings analysts call 
--BSE: Clearing expenses down due to higher contract sizes 
--BSE: Premiums increased in Apr-Jun amid volatility in market 
--BSE: No new consultative process started with SEBI on F&O norms 
--BSE: Took Thursday as expiry day after consultation with mkt participants 
--BSE: In process of adding 140 more co-location racks by FY26-end 
--BSE: Not seeing any specific impact from Jane Street issue 
--BSE: Roughly got revenue of INR 120 mln Q1 from co-location racks rent 

 

By Anshul Choudhary and Taniva Singha

 

MUMBAI – The increase in contract sizes, investors shifting to non-expiry days, and higher premiums owing to volatility in the market helped BSE Ltd. report higher income from transaction charges for the June quarter, while keeping its costs in check. The company saw higher premiums during Apr-Jun due to market volatility induced by US tariff uncertainty, said Sundararaman Ramamurthy, managing director and chief executive officer of BSE, in a conference call with analysts post the company's June quarter earnings Thursday.

 

The company managed to report higher-than-anticipated net profit in the quarter owing to lower expenses. Its clearing and settlement expenses fell by INR 64 million from the previous quarter to INR 555 million and other expenses halved to INR 408 million. This helped the company report an 8% quarter-on-quarter fall in operating expense, which led to its consolidated net profit rising 9% on quarter to INR 5.39 billion.

 

"When the contracts continue to grow, but the contracts are of larger size, so larger volume processed with lesser cost and larger revenue because of increased premium, this results in clearing and settlement cost as a percentage of revenue coming down," Ramamurthy said in the call.

 

Ramamurthy backed the company's decision to choose Thursday as the settlement day for derivatives after the Securities and Exchange Board of India limited the expiry day to Tuesday or Thursday. He said there was a lot of confusion and noise in the market about expiry days, which pushed the SEBI to step in. "Suddenly, there was renewed interest in demand for Tuesday. In order to put a lid on this matter, we thought, we will concede Tuesday..."

 

Ramamurthy said the company is confident about Thursday being the expiry day and the same was decided after consulting with market participants. "Thursday has been the expiry day traditionally for the most successful contract of this country. So, if I am getting it on a platter, why should I not take it?" he said.

 

He clarified that the management has not started any new consultative process with the SEBI on derivatives norms. However, he did not rule out any new regulations for the derivative segment. "Whether there will be room for more regulatory evolutions, that cannot be ruled out because this has been a consistent process," he said.

 

On the Jane Street issue, Ramamurthy said he did see any major impact on the business after the regulator banned the trading firm from the Indian securities market earlier in July. They also don't expect this to impact their growth plans for co-location business.

 

The company plans to add 140 more co-location racks by the end of this financial year. This will be done in two phases, with the first phase likely to be start in a month, Ramamurthy said. BSE earned a revenue of INR 120 million in the June quarter through rents from co-location racks, he said.

 

Ramamurthy said BSE's messages-per-second throttle fee is lower than the competition. The company had revised the fee starting July and now, members are charged after 40 MPS (messages per second) as against the earlier limit of 10,000 MPS. "Charges start at INR 50,000 annually for 100 MPS and increase proportionally depending on subscription," he said.  End

 

Reported by Anshul Choudhary

Edited by Tanima Banerjee

 

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