BSE, Angel One shares tank up to 8% after SEBI Chairman remarks on equity derivatives tenure

Shares of the Bombay Stock Exchange (BSE) fell as much as 8% on Thursday, August 21, after Tuhin Kanta Pandey, Chairman of market regulator Securities and Exchange Board of India (SEBI) made new statements with regards to the tenure of equity derivatives.Speaking at the FICCI Annual Capital Market Conference, Pandey said that there is a need to increase the tenure of equity derivatives.

There will be a consultation paper that will be issued with regards to increasing the tenure of equity derivatives, the SEBI Chairperson said.

The SEBI Chairperson added that the regulator is looking for ways to improve the tenure and maturity of equity derivatives contracts as well as looking to deepen volumes in the cash market.

In an interaction with CNBC-TV18 on August 12, BSE MD & CEO Sundararaman Ramamurthy had said that regulatory policy in Inia is a continuously evolving process and that they would wait for the regulator to formulate a view on reports related to the removal of the weekly expiry.He had also mentioned that based on the data available, he cannot conclude that options volumes have peaked in India and that BSE is currently focussed on diversification of revenue streams, instead of improving margins.

Dinesh Thakkar of Angel One had told CNBC-TV18 on July 22 that 45% of its revenue comes from the F&O broking segment.

Rajesh Baheti of Crosseas Capital Services told CNBC-TV18 that 85% revenue of discount brokers and exchanges is driven by derivatives. He is anticipating a 35% to 40% hit to NSE’s revenue and a 50% to 60% hit to BSE’s topline. He also expects the full service brokerages to see a 10% to 15% hit on revenue.

Shares of BSE ended 7.7% lower at ₹2,330, while those of Angel One ended down 6.4% at ₹2,526.