BSE share price today
: Shares of the
Bombay Stock Exchange
(BSE) plummeted 19% on Monday, hitting Rs 2,612 on the
National Stock Exchange
(
NSE
), following a regulatory setback. The
Securities and Exchange Board of India
(
SEBI
) directed BSE to pay a regulatory fee based on “notional value” rather than the premium value for options contracts. According to ET, this is the largest single-day drop for the stock since its listing in 2017.
In a Friday filing, BSE revealed that SEBI has also demanded a differential regulatory fee for prior periods, with 15% annual interest on any delayed, unpaid, or short-paid amounts.
BSE must comply and pay the outstanding fee within one month of receiving SEBI’s letter.
SEBI introduced a regulatory fee for recognised stock exchanges under the 2006 Regulations on Stock Exchanges. According to these rules, exchanges must pay the fee to SEBI within 30 days after the end of each financial year. The fee rate is determined by the exchange’s annual turnover.
The exchange filing stated, “Since the introduction of derivatives contracts, BSE including the erstwhile
United Stock Exchange
(USE) which got merged into BSE in FY 2014-15 has been paying the regulatory fee on annual turnover to the Board considering the premium value of the contracts instead of the notional value.”
ALSO READ | Stock market today: BSE Sensex surges 300 points to above 74,000 level; Nifty50 near 22,500
In a separate filing, BSE stated that it is currently assessing the validity of SEBI’s claim. If it is determined that the fees must be paid, the total differential regulatory fees from fiscal year 2006–07 to 2022–23 would amount to approximately Rs 68.64 crore plus GST, including Rs 30.34 crore in interest.
The filing also mentioned that the SEBI regulatory fee for fiscal year 2023–24 is due on April 30, 2024. The fee based on the premium (turnover) is approximately Rs 1.66 crore plus GST, which has already been paid by BSE. If the differential regulatory fees are required, they could be about Rs 96.30 crore plus GST for that year.
Following this news and in response to the recent developments, brokerage firm Jefferies downgraded BSE from “Buy” to “Hold.” Additionally, Jefferies reduced the target price for BSE’s stock to Rs 2,900 from Rs 3,000.
Jefferies’ note pointed out that the higher regulatory fee could limit BSE’s short-term growth potential. The brokerage also noted that the SEBI directive might reduce BSE’s Earnings Per Share (EPS) by 15% to 18%.
Jefferies added that if derivatives volume continues to grow as expected, along with price increases and improved premium quality, this could offset the negative impact on EPS.
At 12:32 PM, shares of BSE were trading 12.36% lower at Rs 2,813.60. Even with the recent decline, BSE’s stock has gained over 400% in the past year.
