Goldman Sachs has shown a positive outlook on BSE Limited, after SEBI recently mooted regulating index options expiry days, restricting them to Tuesdays and Thursdays.
This regulatory change is set to support BSE's market standing while reducing concentration risk in the segment.
On March 27, SEBI published a consultation paper outlining its intention to stagger expiry dates on index options. The aim of this step is to improve differentiation in products and stem market concentration, a step that can go in BSE's favor.
Analysts at Goldman Sachs opine that the move comes at a critical time for BSE.
“Previously, the exchange had faced challenges due to SEBI’s limits on options open interest, which had impacted its market share,” the brokerage highlighted.
However, analysts believe that with the new regulatory framework, BSE is now poised for an increase in its index options market share.
Recent figures indicate significant growth in BSE's index options premium market share, increasing from 16% in December 2024 to 21% year-to-date (YTD). March 2025 has been even more robust, with the figure put at 22%. In light of this trend, Goldman Sachs has increased its fiscal 2026-2028 Average Daily Premium forecast by 44%.
The company's estimates for BSE's earnings per share (EPS) have also been upgraded higher, with an average upgrade of 14%. The brokerage also expects a 21% EPS Compound Annual Growth Rate (CAGR) during fiscal years 2025 to 2028.
Despite these encouraging projections, Goldman Sachs has retained its 'neutral' rating on BSE stock. The firm remains cautious due to the relatively lower industry-wide penetration of options trading, which could restrain overall growth.
Should SEBI’s proposal be implemented, it could reinforce BSE’s market standing, positioning the exchange to capitalize on regulatory efforts aimed at enhancing market stability and product differentiation.
The ultimate effect will be a function of how well BSE takes advantage of these changes over the next few months," the brokerage house noted.
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