Mumbai: Stock Exchange Ltd’s (NSE) CEO Ashishkumar Chauhan said on Wednesday that the market share loss to smaller rival BSE Ltd has likely reached its limit and that further losses are unlikely unless new regulations specifically targeting the exchange are introduced.
“The market share loss has pretty much run its course now, given that everything that had to happen has happened, hopefully,” Chauhan said during an investor call discussing the bourse’s Q4 earnings. “Unless new measures are introduced that specifically target only NSE, we believe this is pretty much what has been seen as the market share (loss).”
Chauhan was referring to regulatory changes implemented in October under then Securities and Exchange Board of India chief Madhabi Puri Buch, which included a provision limiting exchanges to just one index options contract per week. As a result, NSE was required to shift its popular Bank Nifty options contract from a weekly to a monthly frequency, retaining only the Nifty options contract.
Bank Nifty had previously accounted for roughly 55% of the total index options turnover, compared to Nifty’s 45%, according to Chauhan.
Data from NSE shows its market share in equity options (both index and stock), based on premium turnover, dropped from 96.9% in FY24 to 87.4% in FY25, with BSE capturing the remaining share.
BSE, which had only one liquid weekly expiry contract–Sensex–benefited from the regulatory rule aimed at curbing retail investor activity in options trading on expiry days.
The loss of market share in index options contributed to a 13% year-on-year decline in NSE’s total income to ₹4,397 crore in Q4FY25. Other factors included lower cash market volumes and reduced clearing activity, and lower treasury income . The exchange saw a modest 7% increase in net profit for FY25, reaching ₹2,650 crore.
In contrast, BSE reported a 70% year-on-year increase in total income to ₹926 crore for Q4FY25, driven by growth in Sensex options trading. Its consolidated net profit surged more than fourfold to ₹494 crore during the same period.
Chauhan, meanwhile, said that NSE has received in-principle approval from Sebi to launch electricity derivatives, and was working on finalizing details, including contract tenure. He also noted that Sebi has yet to provide a no-objection certificate for NSE’s initial public offering.
