Broker’s Call: BSE (Accumulate)

Why It Matters

The sharp earnings lift and higher valuation underscore BSE’s growing relevance in derivatives trading, positioning it for sustained market share gains amid a competitive exchange landscape.

Key Takeaways

• Q3 FY26 PAT rose 173% YoY to ₹600 crore.
• Options ADTO surged 119%, driving revenue growth.
• 500 colocation racks operational; 80 more planned.
• Target price raised to ₹3,408, 45× FY28E P/E.
• Accumulate rating maintained despite cash‑market stagnation.

Pulse Analysis

BSE’s Q3 performance highlights a broader shift toward derivatives as a revenue engine for Indian exchanges. The 119% surge in options average daily turnover reflects heightened investor appetite for hedging and speculative strategies, especially as market volatility persists. Coupled with robust corporate services, this growth trajectory is reinforcing BSE’s earnings base, differentiating it from peers that remain more cash‑market dependent.

Valuation analysts have responded by revising FY27‑28 earnings per share estimates upward by roughly 10‑12%, justifying a target price increase to ₹3,408. The revised multiple of 45× FY28 core P/E, up from 37×, captures both the higher earnings outlook and the premium investors assign to BSE’s expanding infrastructure. Recent STT hikes—5 basis points for options and 3 for futures—are baked into the pricing model, yet the exchange’s strong options volume cushions the impact, preserving margin expansion.

Looking ahead, BSE’s strategic investments in colocation capacity and the StarMF platform aim to attract high‑frequency traders and mutual‑fund distributors, respectively. While the cash market remains range‑bound, the firm’s focus on options and ancillary services offers a clear growth runway. The Accumulate rating reflects confidence in these levers, though investors should monitor cash‑market dynamics and regulatory changes that could affect trading volumes.

Broker’s Call: BSE (Accumulate)

Elara Securities · Updated · February 10 2026 at 06:20 PM

Target: ₹3,408

Current Market Price (CMP): ₹3,174.20

Bombay Stock Exchange (BSE) delivered a robust Q3 FY26 performance, with a PAT of ₹600 crore, up 173 percent year‑on‑year, driven by strong average daily turnover (ADTO) growth. Q3 was characterised by: robust traction in options ADTO, up about 119 percent, and good momentum in corporate services, translating into revenue growth.

The company is well‑positioned to capitalise on structural growth levers as it has established a strong foothold in key verticals. With about 500 colocation racks already in place and plans to add another 80 alongside StarMF as its leading mutual‑fund distribution platform, the exchange boasts robust infrastructure.

In FY25, a temporary H2 FY25 dip in F&O versus H1 FY25 left annual ADTO largely unaffected versus FY24, with BSE indices proving resilient — Sensex options volume rose steadily. For the latest STT revision – the sharpest yet at 5 basis points for options and 3 bps for futures — BSE is well‑insulated, in our view. The cash market—where the exchange has been striving to catch up—continues to be range‑bound at about 6‑7 percent recently, making it a key monitorable. We expect options‑volume improvement to sustain, supporting near‑term momentum.

After factoring in higher ADTO growth, we raise our FY27‑28E EPS by 10‑12 percent each. This, along with our roll‑over to FY28E, leads to a target price of ₹3,408 from ₹2,202 on a 45× (from 37×) FY28E core P/E. We retain an Accumulate recommendation.

Published on February 10 2026