Shares of BSE Limited declined more than 7% in morning trade after the Reserve Bank of India released draft guidelines that could moderate trading activity in capital markets, particularly in the derivatives segment.
The proposed norms are being closely tracked by market participants as they are seen impacting proprietary (prop) trading activity — a key driver of overall exchange volumes. Brokers, exchanges and clearing members are assessing the potential revenue implications if the guidelines are implemented in their current form.
According to market data, nearly 35% of BSE’s total trading volumes are driven by proprietary activity. In the futures and options (F&O) segment, proprietary trades account for around 40% of volumes. Any regulatory tightening that curbs such activity could directly affect turnover levels and transaction-linked revenues across exchanges.
Dhiraj Relli, Managing Director and CEO of HDFC Securities, told CNBC-TV18 that F&O volumes may decline by 15–20% from April 1 if the norms are rolled out in their current form. Such a moderation in derivatives activity could weigh on earnings visibility for exchanges and intermediaries that rely heavily on transaction-based income.
Global brokerage Citi also flagged that the RBI’s draft guidelines may lead to a slowdown in overall trading activity across select cohorts, particularly proprietary trading desks. However, Citi noted that it remains premature to quantify the full profit-and-loss impact, given that the regulatory framework is still evolving and subject to change.
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