Shares of the Bombay Stock Exchange (BSE) tumbled as much as 6% on Thursday, August 21, after comments by SEBI Chairperson Tuhin Kanta Pandey reignited investor concerns about the future of equity derivatives trading.
Speaking at the FICCI Annual Capital Market Conference, Pandey said there is a need to increase the tenure of equity derivatives. He added that the regulator is looking for ways to improve both the tenure and maturity of contracts while also deepening volumes in the cash market.
Importantly, Pandey clarified that weekly expiries are not being removed, addressing speculation that the regulator may do away with them entirely. Instead, SEBI plans to float a consultation paper, seeking stakeholder feedback from brokers, exchanges, and market participants. Final decisions will be made after the SEBI Board reviews the feedback.
Analysts, however, remain cautious. Several brokerages estimate that a sharp reduction in speculative weekly trades could lead to a 50–60% drop in BSE’s derivatives volumes, directly hitting revenues. BSE has been a major beneficiary of the surge in options trading in recent years, and any changes to the F&O structure could meaningfully impact its growth trajectory.
The uncertainty around SEBI’s proposed framework has weighed on stock exchange operators broadly, with both BSE and CDSL seeing selling pressure in recent sessions. Investors will be watching closely for the consultation paper, which is expected to outline specific changes and timelines.
