BSE shares surge 2% today after Goldman Sachs initiates Neutral call

Shares of BSE Ltd climbed nearly 2% today, trading at ₹5,199.70 on the NSE, following Goldman Sachs’ initiation of coverage with a “Neutral” rating and a target price of ₹5,060.

Key Highlights:

Goldman Sachs highlighted BSE’s exposure to robust growth drivers within India’s equity capital markets, emphasizing its fixed-take-rate business model based on the value traded. This model positions the exchange to directly benefit from nominal growth in Indian corporate earnings, which contribute significantly to its equity trading revenues, accounting for 60-70% of total revenue.

Growth Projections:

  • Cash Average Daily Turnover (ADT): An 11% compound annual growth rate (CAGR) is expected.
  • Index Options Market Share: Anticipated growth to 17% aided by options reforms and reduced clearing charges.
  • Financial Metrics: A 10-percentage-point expansion in EBITDA margin and a 5-percentage-point rise in return on equity (ROE) are projected over the medium term.

Valuation Insights:

While the growth prospects remain strong, Goldman Sachs noted that BSE’s current valuations are near all-time highs, with its price-to-earnings-to-growth (PEG) ratio in line with global peers. Consequently, the brokerage maintained a “Neutral” stance, suggesting a balanced risk-reward outlook for the stock.

Bse Share Price history

Day Open Close Change %
Fri, Jan 10 2025
₹5,184.45
₹5,121.65
-1.61%
Thu, Jan 9 2025
₹5,400.40
₹5,205.25
-3.61%
Wed, Jan 8 2025
₹5,392.00
₹5,400.40
+0.22%
Tue, Jan 7 2025
₹5,090.00
₹5,388.30
+5.88%
Mon, Jan 6 2025
₹5,350.00
₹5,089.00
-4.70%
Fri, Jan 3 2025
₹5,493.55
₹5,339.75
-2.31%
Thu, Jan 2 2025
₹5,446.45
₹5,466.20
+0.74%
Wed, Jan 1 2025
₹5,328.00
₹5,426.00
+1.89%