Q1 2027 BSE Ltd Earnings Call

August 4, 2026

Speaker #1: Ladies and gentlemen, good day and welcome to the BSE Limited Q1 FY27 Investor Conference call. As a reminder, all participant clients will be in the listen-only mode, and there will be an opportunity for you to ask questions after the presentation concludes.

Operator 3: Ladies and gentlemen, good day and welcome to the BSE Limited Q1 FY27 investor conference call. As a reminder, all participant clients will be in the listen-only mode, and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during this conference, please signal an operator by pressing star then zero on your touch-tone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Anand Sethuraman, Head of Investor Relations. Thank you, and over to you, sir.

Operator: Ladies and gentlemen, good day and welcome to the BSE Limited Q1 FY27 investor conference call. As a reminder, all participant clients will be in the listen-only mode, and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during this conference, please signal an operator by pressing star then zero on your touch-tone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Anand Sethuraman, Head of Investor Relations. Thank you, and over to you, sir.

Speaker #1: Should you need assistance during this conference, please signal an operator by pressing star, then zero on your touchstone phone. Please note that this conference is being recorded.

Speaker #1: I now hand the conference over to Mr. Arnand Sethuraman, Head of Investor Relations. Thank you, and over to you, sir.

Anand Sethuraman: Thank you, Robin. Good evening, everyone. Welcome to BSE's Q1 FY27 earnings call. My name is Anand Sethuraman, and joining us today is the BSE's leadership team, including our MD & CEO, Mr. Sundararaman Ramamurthy; Mr. S. Gopalan, Executive Director; CFO, Mr. Deepak Goel; Geetha Gangadharan, Chief Regulatory Officer; Mr. Sunil Ramrakhiani, Chief Business Officer; Dr. Vivek Jain, Chief of Staff and HR Strategy; Mr. Viral Davda, Chief Technology Officer; Mr. Rudresh Kunde, Chief of Audit, Policy and Strategy; Mr. Sanjay Jain, Chief Risk Officer. Mr. Shailesh Jain, Head of Legal. Vishal Bhat, Company Secretary. And also joining us are members of our finance, investor relations, and corp comm teams. We also have the MD and CEO of our subsidiary companies, BSE Clearing, Mr. Vaishali Babu, and BSE Index Services, Mr. Ashutosh Singh, respectively. Our latest financial results and investor presentation are now available on the BSE website.

Speaker #2: Thank you, Robin. Good evening, everyone. Welcome to BSE's Q1 FY27 Conference call. My name is Arnand Sethuraman. I'm joining this today as a BSE's leadership team including our MD and CEO, Mr. Sundararaman Ramamurthy.

Speaker #2: Mr. S. Gopalan, Executive Director and CFO; Mr. Deepak Gohil; Ms. Gita Gandhagarin, Chief Executive Officer; Mr. Sunil Ramrakhyani, Chief Business Officer; Dr. Vivek Jain, Chief of Staff and HR Strategy; Mr. Vidul Gavda, Chief Technology Officer; Mr. Rithvesh Kunde, Chief of Product, Policy and Strategy; Mr. Sanjay Jain, Chief Risk Officer; Mr. Shailesh Jain, Head of Legal; Mr. Vishal Bhatt, Company Secretary; and also joining are members of our finance, investor relations, and COPCOM teams.

Speaker #2: We also have the MD and CEO of our subsidiary companies, BSE Clearing with Vaishali Babu and BSE Index Services, Mr. Ashutosh Singh, respectively. Our latest financial results and investor presentation are now available on the BSE website.

Speaker #2: We'll start with remarks from the BSE MD and CEO on our performance, followed by a Q&A session. All participant lines will be muted for the duration of the call.

Anand Sethuraman: We'll start with remarks from BSE MD and CEO on our performance, followed by a Q&A session. All participant lines will be muted for the duration of the call. There will be an opportunity for you to ask questions after the initial management remarks. Please note that some of our statements made today may be forward-looking in nature and are subject to risks and uncertainties. The company does not undertake to update these forward-looking statements publicly. With this, I would now like to invite BSE MD and CEO to share his views. Thank you, and over to you, sir.

Speaker #2: There will be an opportunity for you to ask questions after the initial management remarks. Please note that some of our statements made today may be forward-looking in nature and are subject to risks and uncertainties.

Speaker #2: The company does not undertake to update these forward-looking statements publicly. With this, I would now like to invite the BSE MD and CEO to share his views.

Speaker #2: Thank you, and over to you, sir.

Speaker #3: Thank you, Arnand. Both I am audible. Good evening, everyone, and thank you for joining us today. Let me begin by welcoming our shareholders, analysts, investors, members, and all other stakeholders on this call.

Sundararaman Ramamurthy: Thank you, Anand. Hope I am audible. Good evening, everyone, and thank you for joining us today. Let me begin by welcoming our shareholders, analysts, investors, members, and all other stakeholders on this call. Let me first talk a little bit about the macroeconomic environment. Indian capital markets continue to demonstrate exceptional resilience against global uncertainties. Following a temporary correction near 72,000, the benchmark Sensex staged a robust recovery, firmly anchored by strong domestic fundamentals and vibrant economic activity. This positive momentum is further validated by encouraging corporate earnings, underscoring the market's profound depth and long-term growth prospects. Crucially, the defining shift in our ecosystem is the accelerating strength of retail and domestic institutional participation. While global dynamics led to foreign outflows of INR 3.6 lakh crore during the first seven months of 2026, domestic institutions convincingly countered this trend, deploying a historic INR 5 lakh crores.

Speaker #3: Let me first talk a little bit about the macroeconomic environment. Indian capital markets continue to demonstrate exceptional resilience against global uncertainties. Following a temporary correction near 72,000, the benchmark Sensex staged a robust recovery.

Speaker #3: Firmly anchored by strong domestic fundamentals, and vibrant economic activity, this positive momentum is further validated by encouraging corporate earnings underscoring the market's profound depth and long-term growth prospects.

Speaker #3: Crucially, the defining shift in our ecosystem is the accelerating strength of retail and domestic institutional participation. While global dynamics led to foreign outflows of ₹3.6 lakh crore during the first seven months of 2026, domestic institutions convincingly countered this trend, deploying a historic ₹5 lakh crore. This powerful local support, combined with moderating foreign selling in July, highlights unshakable confidence in India's trajectory as our markets become increasingly self-sustaining.

Sundararaman Ramamurthy: This powerful local support, combined with moderating foreign selling in July, highlights unshakable confidence in India's trajectory as our markets become increasingly self-sustaining. Against this backdrop, I'm pleased to share that BSE had a strong start to the financial year with Q1 FY2027 being the company's best quarterly results on record and the 14th consecutive quarter of record revenues. Consolidated revenues stood at INR 1,707 crores, surpassing the previous quarter's record of INR 1,630 crores. I will now share some of the key financial numbers on a consolidated basis for the quarter ended 30 June 2026, as compared to the previous year. Operational revenues have grown by 63% to INR 1,566 crores from INR 958 crores.

Speaker #3: Against this backdrop, I'm pleased to share that BSE had a strong start to the financial year, with Q1 FY2027 being the company's best quarterly results on record and the 14th consecutive quarter of record revenues.

Speaker #3: Consolidated revenues stood at ₹1,707 crore, surpassing the previous quarter's record of ₹1,630 crore. I will now share some of the key financial numbers on a consolidated basis for the quarter ended June 30, 2026, as compared to the previous year.

Speaker #3: Operational revenues have grown by 63% to rupees 1,566 crores from rupees 958 crores transaction charges comprising revenues from the equity cash, equity derivatives, mutual fund, and clearing house segments have registered a substantial increase of 80%, rising to rupees 1,328 crores from rupees 737 crores reflecting robust growth in core trading and settlement-related activities.

Sundararaman Ramamurthy: Transaction charges comprising revenues from the equity cash, equity derivatives, mutual fund, and clearing house segments have registered a substantial increase of 80%, rising to INR 1,328 crores from INR 737 crores, reflecting robust growth in core trading and settlement-related activities. Other operating income, which includes enhanced data dissemination fees, co-location, index services, etc., have increased by 40% to INR 98 crores from INR 70 crores. Operating expenses increased by 56% to INR 520 crores from INR 332 crores. It may be noted that 54% of the total operating expenses are attributable to regulatory fees and clearing and settlement expenses, all of which is directly correlated to increasing transaction volumes. The operating EBITDA, including contribution to Core SGF, has increased by 67% to INR 1,046 crores as compared to INR 625 crores, with margins expanding to 67% from 65%.

Speaker #3: Other operating income is includes enhanced data dissemination seeds co-location index services etc has increased by 40% to rupees 98 crores from rupees 70 crores.

Speaker #3: Operating expenses increased by 56% to rupees 520 crores from rupees 332 crores it may be noted that 54% of the total operating expenses are attributable to regulatory fees and clearing and settlement expenses all of which is directly correlated to increasing transaction volumes.

Speaker #3: The operating EBITDA including contribution to core SGF has increased by 67% to rupees 1,046 crores as compared to rupees 625 crores with margins expanding to 67% from 65%.

Speaker #3: The net profit attributable to the shareholders of the company has demonstrated a significant acceleration to reach ₹873 crores from ₹539 crores, representing a robust year-on-year growth of 62%, with a net profit margin of 51%.

Sundararaman Ramamurthy: The net profit attributable to the shareholders of the company has demonstrated a significant acceleration to reach INR 873 crores from INR 539 crores, representing a robust year-on-year growth of 62%, with a net profit margin of 51%. The continued improvement in both the top line and bottom line demonstrates the company's robust operational performance, effective execution, and consistent financial momentum. It further highlights broad-based participation across our platforms, the impact of key strategic initiatives, and the rising confidence of India's capital market ecosystem in BSE. A key indicator of this deepening market footprint is our investor registration data. The total number of investor accounts registered on the BSE has reached an impressive 25.8 crores, reflecting the steady expansion of retail participation across the country. Over the past year alone, we added 3.5 crore new investor accounts with 11 states each contributing more than 1 crore investors.

Speaker #3: The continued improvement in both the top line and bottom line demonstrates the company's robust operational performance effective execution and consistent financial momentum. It further highlights broad-based participation across our platforms the impact of key strategic initiatives and the rising confidence of India's capital market ecosystem in BSE.

Speaker #3: A key indicator of this deepening market footprint is our investor registration data. The total number of investor accounts registered on the BSE has reached an impressive 25.8 crore, reflecting the steady expansion of retail participation across the country. Over the past year alone, we added 3.5 crore new investor accounts, with 11 states each contributing more than 1 crore investors.

Sundararaman Ramamurthy: This clearly underscores the true demographic and geographic expansion of India's capital markets. Complementing this structural growth, we conducted 23 investor awareness programs during Q1 FY27, reaching over 4,900 participants. Looking ahead, the BSE remains deeply and unbreakably committed to expanding investor awareness and advancing financial literacy. We view this educational mandate as a key pillar for promoting informed investment decisions, safeguarding investor interests, and securing the long-term sustainable growth of India's financial ecosystem. Let me now discuss a few key trends shaping our business this quarter. H1 FY27 witnessed a moderation in main board IPO activity, largely driven by global macroeconomic factors, as mentioned earlier. However, we have already begun to see encouraging signs of recovery. July 2026 marked a notable improvement in primary market activity with 13 main board IPOs collectively raising approximately INR 18,348 crores, reflecting improving investor sentiment and renewed issuer confidence.

Speaker #3: This clearly underscores the true demographic and geographic expansion of India's capital markets. Complementing this structural growth, we conducted 23 investor awareness programs during Q1 FY27, reaching over 4,900 participants.

Speaker #3: Looking ahead, the BSE remains deeply and unbreakably committed to expanding investor awareness and advancing financial literacy. We view this educational mandate as a key pillar for promoting informed investment decisions, safeguarding investor interests, and securing the long-term, sustainable growth of India's financial ecosystem.

Speaker #3: Let me now discuss a few key trends shaping our business this quarter. The first half of FY27 witnessed a moderation in main board IPO activity, largely driven by global macroeconomic factors, as mentioned earlier.

Speaker #3: However, we have already begun to see encouraging signs of recovery. July 2026 marked a notable improvement in primary market activity, with 13 main board IPOs collectively raising approximately ₹18,348 crore, reflecting improving investor sentiment and renewed issuer confidence.

Speaker #3: While the main board IPO market witnessed temporary moderation the SME segment remained vibrant and continued to attract strong issuer and investor interest. BSE SME achieved a significant milestone by surpassing 750 listed companies in July 2026 compared with 600 a year earlier.

Sundararaman Ramamurthy: While the main board IPO market witnessed temporary moderation, the SME segment remained vibrant and continued to attract strong issuer and investor interest. BSE SME achieved a significant milestone by surpassing 750 listed companies in July 2026 compared with 600 a year earlier. The latest 150 listings alone have raised INR 6,323 crores, accounting for nearly 38% of cumulative capital raised on the platform, highlighting the increasing contribution of SME to India's economic growth and capital development. Overall, in Q1 FY2027, issuers raised over INR 6.2 lakh crores through BSE's fundraising platforms across equity, debt, bonds, commercial papers, REITs, Infrastructure Investment Trusts, and municipal bonds, reaffirming the trust placed in BSE's market infrastructure. Looking ahead, we remain constructive on the outlook for India's primary markets. The main board IPO pipeline remains strong, with over 250 companies seeking to access the capital markets and targeting fundraising of approximately INR.

Speaker #3: The latest 150 listings alone have raised ₹6,323 crore, accounting for nearly 38% of cumulative capital raised on the platform, highlighting the increasing contribution of SMEs to India's economic growth and capital development.

Speaker #3: Overall, in Q1 FY2027, issuers raised over ₹6.2 lakh crore through BSE's fundraising platforms across equity, debt, bonds, commercial papers, REITs, and municipal bonds, reaffirming the trust placed in BSE's market infrastructure.

Speaker #3: Looking ahead, we remain constructive on the outlook for India's primary markets. The main board IPO pipeline remains strong, with over 250 companies seeking to access the capital markets and targeting fundraising of approximately ₹1.75 lakh crore.

Sundararaman Ramamurthy: Looking ahead, we remain constructive on the outlook for India's primary markets. The main board IPO pipeline remains strong, with over 250 companies seeking to access the capital markets and targeting fundraising of approximately INR. INR 175,000 crore. Moving on to our trading segment, we continued to witness strong momentum across both our cash and derivatives market, supported by growing client participation and product innovation. In the equity cash segment, BSE recorded its highest ever quarterly average daily turnover of INR 9,955 crore in Q1 FY27, reflecting sustained market participation and strengthening liquidity on the exchange.

Sundararaman Ramamurthy: INR 175,000 crore. Moving on to our trading segment, we continued to witness strong momentum across both our cash and derivatives market, supported by growing client participation and product innovation. In the equity cash segment, BSE recorded its highest ever quarterly average daily turnover of INR 9,955 crore in Q1 FY27, reflecting sustained market participation and strengthening liquidity on the exchange. Our derivatives segment delivered yet another record performance, with average daily premium turnover reaching an all-time high of INR 29,614 crore during the quarter, representing a robust year-on-year growth of 96%. Crucially, our strategic focus on expanding market depth is delivering measurable results. During the quarter, we successfully launched derivatives on the BSE focused IT index, which has already completed three expiry cycles, with trading activity and market participation continuing to gain momentum every passing expiry cycle.

Speaker #3: Moving on to our trading segment, we continue to witness strong momentum across both our cash and derivatives markets, supported by growing client participation and product innovation.

Speaker #3: In the equity cash segment BSE recorded its highest ever quarterly average daily turnover of rupees 9,955 crores in Q1 FY27 reflecting sustained market participation and strengthening liquidity on the exchange.

Speaker #3: Our derivatives segment delivered yet another record performance, with average daily premium turnover reaching an all-time high of ₹29,615 crore during the quarter, representing a robust year-on-year growth of 96%.

Sundararaman Ramamurthy: Our derivatives segment delivered yet another record performance, with average daily premium turnover reaching an all-time high of INR 29,614 crore during the quarter, representing a robust year-on-year growth of 96%. Crucially, our strategic focus on expanding market depth is delivering measurable results. During the quarter, we successfully launched derivatives on the BSE focused IT index, which has already completed three expiry cycles, with trading activity and market participation continuing to gain momentum every passing expiry cycle.

Speaker #3: Crucially, our strategic focus on expanding market depth is delivering measurable results. During the quarter, we successfully launched derivatives on the BSE-focused IP index, which has already completed three expiry cycles, with trading activity and market participation continuing to gain momentum with every passing expiry cycle.

Sundararaman Ramamurthy: By introducing these contracts, BSE became the first exchange in India to offer derivatives products benchmarked to the wider IT sector. This met an immense market demand for hedging and tactical risk management in technology portfolios. The early adoption of focused IT index, combined with our growing derivatives volume, proves that our platform enhancements and unique product designs are resonating deeply with market participants. Moving to other operational revenue streams, BSE's colocation business continued to perform well, with revenues of INR 51 crore in Q1 FY27. We remain committed to further expanding our colocation infrastructure in line with client demand and growing market participation. Turning to our mutual fund distribution business, BSE StAR MF continues to deliver strong and consistent growth. During Q1 FY27, the platform processed 23.4 crore transactions, representing a healthy 28% year-on-year increase. Revenues for the quarter grew 20% year-on-year to INR.

Speaker #3: By introducing these contracts, BSE became the first exchange in India to offer derivatives products benchmarked to the vital IP sector. This meant an immense market demand for hedging and tactical risk management in technology portfolios.

Speaker #3: The early adoption of focused IP index, combined with our growing derivatives volume, proves that our platform enhancement and unique product designs are resonating deeply with market participants.

Speaker #3: Moving to other operational revenue streams BSE's co-location business continued to perform well with revenues of rupees 51 crore in Q1 FY27. We remain committed to further expanding our co-location infrastructure in line with client demand and growing market participation.

Speaker #3: Turning to our mutual fund distribution business BSE Star MF continues to deliver strong and consistent growth. During Q1 FY27 the platform processed 23.4 crore transactions representing a healthy 28% year-on-year increase.

Sundararaman Ramamurthy: Revenues for the quarter grew 20% year-on-year to INR. INR 73.3 crore, reflecting continued growth in investor participation and the increasing scale of India's mutual fund ecosystem. As mentioned in my last earnings call update, StAR NPS platform by BSE Technologies continues to expand by integrating central record-keeping agencies and pension fund managers, thereby providing a unified architecture for seamless NPS adoption and management. Through this initiative, we are strengthening our position as a comprehensive investment and retirement solutions platform, supporting investors throughout their long-term wealth creation journey. To further unlock the latent value of our revenue streams, we are transitioning our data business operations. Starting 1 January 2027, BSE will conclude its 13-year marketing partnership with Deutsche Börse and directly manage the distribution and licensing of our market data worldwide, standardizing our outreach and establishing a direct line of engagement with our international client base.

Speaker #3: Revenues for the quarter grew 20% year-on-year to rupees 73.3 crores reflecting continued growth in investor participation and the increasing scale of India's mutual fund ecosystem.

Sundararaman Ramamurthy: INR 73.3 crore, reflecting continued growth in investor participation and the increasing scale of India's mutual fund ecosystem. As mentioned in my last earnings call update, StAR NPS platform by BSE Technologies continues to expand by integrating central record-keeping agencies and pension fund managers, thereby providing a unified architecture for seamless NPS adoption and management. Through this initiative, we are strengthening our position as a comprehensive investment and retirement solutions platform, supporting investors throughout their long-term wealth creation journey. To further unlock the latent value of our revenue streams, we are transitioning our data business operations. Starting 1 January 2027, BSE will conclude its 13-year marketing partnership with Deutsche Börse and directly manage the distribution and licensing of our market data worldwide, standardizing our outreach and establishing a direct line of engagement with our international client base.

Speaker #3: As mentioned in my last earnings call update Star NPS platform by BSE Technologies continues to expand by integrating central record keeping agencies and pension fund managers thereby providing a unified architecture for seamless NPS adoption and management.

Speaker #3: Through this initiative we are strengthening our position as a comprehensive investment and retirement solutions platform supporting investors throughout their long-term wealth creation journey. To further unlock the latent value of our revenue streams we are transitioning our data business operations starting Jan 1, 2027 BSE will conclude its 13-year marketing partnership with Deutsche Bose and directly manage the distribution and licensing of our market data worldwide standardizing our outreach and establishing a direct line of engagement with our international client base.

Speaker #3: Our key subsidiaries, the Indian Clearing Corporation Limited (ICCL) and BSE Index Services, continue to scale through new client acquisitions, product innovation, and enhanced technology adoption.

Sundararaman Ramamurthy: Our key subsidiaries, the Indian Clearing Corporation Limited (ICCL), and BSE Index Services, continue to scale through new client acquisitions, product innovation, and enhanced technology adoption. Furthermore, our clearing corporation, formerly known as ICCL, has been rebranded as BSE Clearing Limited, reinforcing its strong alignment with the trusted BSE brand and strengthening its position within India's financial market infrastructure ecosystem. Overall, Q1 FY27 was another strong quarter for BSE, marked by healthy growth across our businesses, continued product innovation, and expanding participation across our platforms. We remain focused on strengthening the market infrastructure, enhancing the customer experience, and creating new opportunities for issuers, investors, and intermediaries. Furthermore, our structural transformation and consistent market execution have earned us significant institutional recognition. BSE was recently honored with the prestigious Wealth Creator of the Year award at the NDTV Profit Business Leadership Awards 2026, presented by the Honorable Union Finance Minister.

Speaker #3: Furthermore our clearing corporation formerly known as ICCL has been rebranded as BSE Clearing Limited reinforcing its strong alignment with the trusted BSE brand and strengthening its position within India's financial market infrastructure ecosystem.

Speaker #3: Overall, Q1 FY27 was another strong quarter for BSE, marked by healthy growth across our businesses, continued product innovation, and expanding participation across our platforms. We remain focused on strengthening our market infrastructure, enhancing the customer experience, and creating new opportunities for issuers, investors, and intermediaries.

Speaker #3: Furthermore, our structural transformation and consistent market execution have earned us significant institutional recognition. BSE was recently honored with the prestigious Wealth Creator of the Year award at the NDPV Profit Business Leadership Awards 2026, presented by the Honorable Union Finance Minister. This accolade, alongside being named Derivatives Exchange of the Year and Index Provider of the Year, among others, underscores our industry leadership and validates our ongoing commitment to generating exceptional value for all our stakeholders.

Sundararaman Ramamurthy: This accolade, alongside being named Derivatives Exchange of the Year and Index Provider of the Year, and among others, underscores our industry leadership and validates our ongoing commitment to generating exceptional value for all our stakeholders. Looking ahead, we remain confident in the long-term growth prospects of India's capital markets. Backed by our strong market position, technology-led innovation, and diversified business model, we will continue to invest in future growth opportunities, expand our product and service offerings, and deliver sustainable value to all our stakeholders. Thank you for your continued trust and support. With these updates, I now hand over the call back to Anand.

Speaker #3: Looking ahead we remain confident in the long-term growth prospects of India's capital markets. Backed by our strong market position technology-led innovation and diversified business model we will continue to invest in future growth opportunities expand our product and service offerings and deliver sustainable value to all of our stakeholders.

Speaker #3: Thank you for your continued trust and support. With these updates, I now hand the call back to Anand.

Speaker #1: Thank you, sir. We will now open the floor for the question-and-answer session. I request all participants to kindly limit yourselves to one question per participant. Please be patient, and we will come back to you if time permits.

Anand Sethuraman: Thank you, sir. We will now open the floor for question and answer session. I request all participants to kindly limit yourself to one question per participant. Please be patient, and we will get back to you with the exact time.

Speaker #2: Thank you very much. We will now begin the question-and-answer session. Anyone who wishes to ask a question may press star and one on the touch-tone telephone.

Operator 3: Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on their touchtone telephone. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to please use handsets while asking a question. Once again, we also request you to please restrict yourselves to one question only. If you have any further questions, you may rejoin the queue. Ladies and gentlemen, we will now wait for a moment while the question queue assembles. The first question is from the line of Aditya Vikram with DB Securities Private Limited. Please go ahead.

Operator: Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on their touchtone telephone. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to please use handsets while asking a question. Once again, we also request you to please restrict yourselves to one question only. If you have any further questions, you may rejoin the queue. Ladies and gentlemen, we will now wait for a moment while the question queue assembles. The first question is from the line of Aditya Vikram with DB Securities Private Limited. Please go ahead.

Speaker #2: If you wish to remove yourself from the question queue you may press star and two. Participants are requested to please use handsets while asking a question.

Speaker #2: Once again, we also request that you please restrict yourself to one question only. If you have any further questions, you may rejoin the queue.

Speaker #2: Ladies and gentlemen, we will now wait for a moment while the question queue assembles. The first question is from the line of Aditya Vikram with DB Securities Private Limited.

Speaker #2: Please go ahead.

Aditya Vikram: Hi. Am I on?

Speaker #3: Hi. I'm Anand.

Speaker #1: Yes you are.

Sundararaman Ramamurthy: Yes, you are.

Aditya Vikram: Hi. Thanks so much. Sir, I was looking at the presentation. I just want to understand what led to a decrease in your operating expense by INR 400 crores in other expense side.

Speaker #3: Hi, thanks so much. Sir, I was looking at the presentation. I just want to understand what led to a decrease in your operating expenses by ₹400 crore in the 'Other expenses' line.

Sundararaman Ramamurthy: Is it INR 400 crores or INR 40 crores?

Speaker #1: Is this 400 crores or 40 crores?

Aditya Vikram: I'm sorry, INR 40 crores. Apologies, INR 40 crores.

Speaker #3: I'm sorry, 40 crores. Apologies—40 crores.

Sundararaman Ramamurthy: I think my CFO will answer it. There was a provision made with regard to a dues receivable from one of our creditors. There are also provision made for it. That should be the case. Deepak, you please explain. Yes, you are right, sir. There was a provision of about INR 40 crore in our subsidiary clearing company from one of the debtors. Because of that, in previous quarter, other expenses was slightly higher.

Speaker #1: So, I think my CFO will answer it. There was a provision made with regard to dues receivable from one of our creditors; there was a provision made for it. That should be the case. Deepak, will you please explain? Yes, you're right, sir.

Deepak Goel: Yes, you are right, sir. There was a provision of about INR 40 crore in our subsidiary clearing company from one of the debtors. Because of that, in previous quarter, other expenses was slightly higher.

Speaker #1: So there was a provision of about ₹40 crore made in our subsidiary clearing company from one of the debtors. Because of that, in the previous quarter, other expenses were slightly higher.

Speaker #3: Okay. So, this would be a steady state of other expenses going forward. Is that fair to assume?

Aditya Vikram: Okay. This would be a steady state of other expenses going forward. Is that fair to assume?

Speaker #1: I would not want to comment on the future, but on a comparable basis, the reason why March quarter expenses were higher—I have given you the reason.

Sundararaman Ramamurthy: I would not want to comment on future, but on comparable basis, the reason why March quarter expenses were higher, I have given you.

Speaker #3: Okay. Thank you very much.

Aditya Vikram: Okay. Thank you very much.

Speaker #2: Thank you. The next question is from the line of Swarnath Mukherjee with 361 Capital. Please go ahead.

Operator 3: Thank you. The next question is from the line of Swarnabh Mukherjee with 360 ONE. Please go ahead.

Operator: Thank you. The next question is from the line of Swarnabh Mukherjee with 360 ONE. Please go ahead.

Speaker #4: Yeah. Hi sir. Thank you for the opportunity and congratulations on a good set of number. My question pertains to the colocation business. I just wanted to understand so I mean the quarter on quarter improvement in the revenue just wanted to understand what is the situation here if you could give some color in terms of offtake and number of racks that you have and any plans of you know further monetization if you could highlight that would be very helpful.

Swarnabh Mukherjee: Yeah. Hi, sir. Thank you for the opportunity, and congratulations on a good set of numbers. My question pertains to the colocation business. I just wanted to understand the quarter on quarter improvement in the revenue. Just wanted to understand what is the situation here, if you could give some color in terms of off-take and number of racks that you have and any plans of further monetization, if you could highlight, sir, that would be very helpful. Thanks.

Speaker #4: Thanks.

Speaker #1: Thank you, Mr. Mukherjee, for your kind words. As you would know, when we started this derivatives business in BSE three and a half years ago, we did not have any meaningful number of racks or a proper data center.

Sundararaman Ramamurthy: Thank you, Mr. Mukherjee, for your kind words. As you would know, when BSE, when we started this derivatives business in BSE three and a half years before, we did not have any meaningful number of racks or a proper data center. While we started developing the data center business. In phases, we want to increase the number of racks. I've always been telling that we will take it up to 500 numbers. Over a period of time, today, I'm very proud to say we have got that number in place, and we have 500 racks. When we are giving these racks over a period of time in phases, what happens is the off-take of the number of racks is also gradual and upward movement.

Speaker #1: While we started developing the data center business in phases, we wanted to increase the number of racks. I've always been saying that we will take it up to 500, and over a period of time, today I'm very proud to say we have reached that number and we have 500 racks.

Speaker #1: When we are giving these racks over a period of time in phases, what happens is the offtake of the number of racks is also gradual and there is an upward movement.

Speaker #1: And the charges also had been changed from the initial number to the number for rack, which was rent as a normal, what is available in the market.

Sundararaman Ramamurthy: The charges also are being changed from the initial number to the number for rack, what is rent as a normal, what is available in the market. That has increased our revenue. Subsequently, we also started charging for order flow. At this point of time, more and more orders are flowing because of which, if you look at it, there has been a steady increase in the revenue. As well as this, what is the state? At this point of time, we feel the 500 racks that we have, with the proper off-take that has already happened, will sustain ourselves for at least a minimum of one and a half years. That is our current thought process. We've seen the traffic of what we are seeing, given the global conditions and local economic conditions.

Speaker #1: That has increased our revenue. Subsequently we also started charging for order flow. At this point of time more and more orders are flowing because of which if you look at it there has been a steady increase in the revenue.

Speaker #1: As well as this, what is the state at this point of time? We say the 500 racks that we have, with the proper offtake that has already happened, will sustain ourselves for at least a minimum of one and a half years. So that is our current thought process.

Speaker #1: It's seeing the traffic of what we are seeing given the global conditions and local economic conditions. As far as the order flow is concerned, currently whatever we are charging is 20% of what the market rates are.

Sundararaman Ramamurthy: As far as the order flow is concerned, currently whatever we are charging is 20% of what the market rates are. We will reconsider whether we should increase it or not at an appropriate time and at appropriate stages. We have always considered colo as a place where it has to move up in terms of charging based on market's interest increasing more and more with the Sensex and other products of BSE. That is where we actually stand at this point of time.

Speaker #1: We would reconsider whether we should increase it or not at an appropriate time, and at appropriate stages. We have always considered colo as a place where it has to move up in terms of charging, based on market interest increasing more and more with the Sensex and other products of BSE.

Speaker #1: So that is where we actually stand at this point of time.

Speaker #2: Understood sir very clear. Just is it possible to break up the 51 crores in rental and order flow based income?

Swarnabh Mukherjee: Understood, sir. Very clear. Just, is it possible to break up the INR 51 crores in rental and order flow-based income?

Speaker #1: Swarnath will just take that question later. We can possibly connect later. We don't have the numbers currently now.

Sundararaman Ramamurthy: Swarnabh, we'll just take that question later. We can possibly connect later. We don't have the numbers currently now.

Speaker #2: Okay sure. Thank you so much and all the best sir. Thank you.

Swarnabh Mukherjee: Okay, sure. Thank you so much. All the best, sir. Thank you.

Speaker #1: Thank you.

Sundararaman Ramamurthy: Thank you.

Speaker #2: Our next question comes from the line of Amit Chandra with HDFC Securities. Please go ahead.

Operator 3: Our next question comes from the line of Amit Chandra with HDFC Securities. Please go ahead.

Operator: Our next question comes from the line of Amit Chandra with HDFC Securities. Please go ahead.

Speaker #4: Yeah. Thanks for the opportunity. Sir my first question is in is accumulated to the monthly volumes. So you know last quarter we mentioned that we are focusing more on increasing the share of you know the monthly volumes in the options overall volumes and we have also onboarded you know quite a number of FPIs onto our platform.

Amit Chandra: Yeah, thanks for the opportunity. Sir, my first question is actually related to the monthly volumes. I know last quarter we mentioned that we are focusing more on increasing the share of the monthly volumes in the options overall volumes. We have also onboarded quite a number of FPIs onto our platform. The share of FPI is also increasing gradually. What is the kind of rate we are seeing there? Also, in terms of the market share gap between the notion and the premium, when we can see that converging? Also, if you can give your initial thoughts on the recent cash mechanism. How is it going to impact the volumes? Thank you, sir.

Speaker #4: And you know the share of FPI is also increasing gradually but you know how you know what is the kind of rate we are seeing there and also in terms of the market share gap between the notion and the premium when we can see that converging.

Speaker #4: And also if you can you know give you initial thoughts on the recent cash like mechanism. Is it you know how how is it going to impact the volumes?

Speaker #4: Thank you.

Sundararaman Ramamurthy: Amitji, thanks first of all for participation. In a single question, actually, you have put across three or four questions of different topics. The cash part of it, I will first say that it is too early to talk in great detail. It is just 2 days. Let us keep it for a subsequent day. Let us look at the monthly volumes and talk about in detail and about the market share with an inverted commas. As well as the monthly volumes, which we've always been telling that we are working on, what we are very happy to see is if I take January 2025, number of contracts that we traded in other than the next week. That is current week, not current week, not next week, other than current week and next week, if we take.

Speaker #1: Amit ji, thanks sir, first of all for your participation. In a single question, actually, you have put across three or four questions of different topics.

Speaker #1: The cash part of it I will first say that it is too early to talk in great detail. It is just two days. Let us keep it for a subsequent day.

Speaker #1: Let us look at the monthly volumes and talk about in detail and about the market share with an inverted commas. As far as the monthly volumes which we've always been telling that we are working on what we are very happy to see is if I take January 2025 number of contracts that we traded in other than the next week that is current week not not current week not next week other than current week and next week if we take if I take it as one and the current volume in terms of number of contracts is actually five times more.

Sundararaman Ramamurthy: If I take it as one, and the current volume in terms of number of contracts is actually 5 times more. It is showing an improvement. From January 2025 to July 2026, it is a long period. It is taking time, but it is growing. In between this period, we have seen lot of changes. As you would recollect, lot of headwinds. Notwithstanding that, it has grown. And in terms of premium, if I look at the same period, it has grown almost to 10 times as to what it was. Clearly, there is growth in the premium coming from weeks other than current and next week. But is it the place where we would like to be? No. We want to grow further. It is taking time because the headwinds, as you know, including the current RBI circular, are playing in a large way as retarding to this growth.

Speaker #1: It's showing an improvement. So on Jan 25 to July 26 it's a long period it is taking time but it is growing. In between this period we have seen lot of changes as you would recollect lot of headwinds notwithstanding that it has grown.

Speaker #1: And in terms of premium, if I look at the same period, it has grown almost 10 times what it was. Clearly, there is growth in the premium coming from weeks other than current and next week.

Speaker #1: But is it the place where we would like to be? No. We want to grow further. It is taking time because the headwinds, as you know, including the current RBA circular, are playing a large role in retarding this growth.

Speaker #1: But hopefully we will reach where because of the advocacy efforts that we are putting in towards the market. In terms of market share we do not measure our success in terms of market share as I have repeatedly talked about.

Sundararaman Ramamurthy: Hopefully we will reach well because of the advocacy efforts that we are putting in towards the market. In terms of market share, we do not measure our success in terms of market share, as I have repeatedly talked about. What we find is our volumes, in terms of premium, has been showing a consistent growth. And in terms of what you are looking for as a proportion to what NSE's Nifty trades, if you are looking at it and calling it as market share, we find that proportion is also going up. We are not tracking that because that is not our primary goal. Our primary goal, as I always say, is deepening and broadening of markets. The number of participants has significantly increased. Today, more than 610 members regularly participate. Around 650 FPIs are participating.

Speaker #1: What we find is our volumes in terms of premium has been showing their consistent growth and in terms of what you are looking for as a proportion to what NSE's Nifty trades if you are looking at it and calling it as market share we find that proportion is also going up but we are not tracking that because that is not our primary goal.

Speaker #1: Our primary goal as I always say is deepening and broadening of markets the number of participants has significantly increased today more than 610 members regularly participate around 650 FPIs are participating our target as I have always been telling is at least to take this number to 800.

Sundararaman Ramamurthy: Our target, as I have always been telling, is at least to take this number to 800. We are working on those parameters, and we hope we will achieve it soon. Hope I have answered your question. Thanks for your participation, Amit Ji.

Speaker #1: We are working on those parameters and we hope we will achieve it soon. Hope I have answered your question. Thanks for your participation Amit ji.

Speaker #4: Yeah, sir. Thank you, and all the best, sir. Thank you.

Amit Chandra: Yes, sir. Thank you, and all the best, sir. Thank you.

Speaker #2: Thank you. The next question is from the line of Supratim Datta with Jefferies. Please go ahead.

Operator 3: Thank you. The next question is from the line of Supratim Dutta with Jefferies. Please go ahead.

Operator: Thank you. The next question is from the line of Supratim Dutta with Jefferies. Please go ahead.

Speaker #5: Hi everyone. Thanks a lot for the opportunity. My question is on the new product side you know sensex has really done well. You have launched you know the focused ID contract as well.

Operator 2: Hi, everyone. Thanks a lot for the opportunity. My question is on the new product side. Sensex has really done well. You have launched the focused IT contract as well. Just wanted to understand, how is the pipeline of new products looking like? Would it be more focused on options or you are looking at other areas of launching new products as well? Yeah. Thank you.

Supratim Datta: Hi, everyone. Thanks a lot for the opportunity. My question is on the new product side. Sensex has really done well. You have launched the focused IT contract as well. Just wanted to understand, how is the pipeline of new products looking like? Would it be more focused on options or you are looking at other areas of launching new products as well? Yeah. Thank you.

Speaker #5: Just wanted to understand you know how is the pipeline of you know new products looking like? Would it be more focused on options or you know you are looking at other areas of you know launching new products as well?

Speaker #5: Yeah. Thank you.

Sundararaman Ramamurthy: Thanks once again, Dutta Ji, for participation. When we talk of new products, it is just not the trading products we are looking at. Currently, there is a lot of focus from our side on, say, for example, corporate bonds. As you would recall, we are working with the regulators together. Regulators have coined this bond, Sashakta Bandhan, and we are working on creating awareness of corporate bonds and how it is important. That is one area we are working upon. That is one of the pipelines. Enhanced data dissemination as a product is certainly another focus. A great focus is from our side on the indices.

Speaker #1: Thanks again Datta ji for participation. When we talk of new products it is just not the trading products we are looking at. Currently there is a lot of focus from our side on say for example corporate bonds.

Speaker #1: As you would recall we have we have we are working with the regulators together regulators have coined this bond sashakta bandhan and we are working on creating a awareness of corporate bonds and how it is important.

Speaker #1: So that is one area we are working on. That is one of the pipelines. Data-enhanced data discrimination as a product is certainly another focus.

Speaker #1: A great focus from our side is on the indices. We have created 16 new indices and we find there is a good amount of demand for the indices that we create because of the innovative approach with which we look at it and come out with concepts which are interesting, appealing, and good for the market.

Sundararaman Ramamurthy: We have created 16 new indices, and we find there is a good amount of demand for the indices that we created because of the innovative approach with which we look at it and come out with concepts which are interesting, appealing, and good for the market. That is another area of focus for us. We have recently, through our subsidiary, have provided a platform to enhance the penetration of the pension schemes as a thought process through PFRDA's NPS. We call it a StAR NPS. Early days, we feel that is going to be another product which will revolutionize the market and make people think very seriously about pension, which is a retirement planning which everybody has to do.

Speaker #1: So that is another area of focus for us. We have recently, through our subsidiary, provided a platform to enhance the penetration of the pension schemes as a thought process through PFRDA's NPS.

Speaker #1: We call it as start NPF early days we feel that is going to be another product which will revolutionize the market and make people think very seriously about pension which is a retirement planning which everybody has to do.

Speaker #1: Also we are thinking in terms of pushing the electronic gold receipts because as you know too much of craze towards the gold can lock all our resources into physical gold instead to start with if we start with electronic gold receipts it is a movement away from physical gold and make more towards more of DMB realized assets which mimic gold and could be good for the economy.

Sundararaman Ramamurthy: We are thinking in terms of pushing the Electronic Gold Receipts, because as you know, too much of craze towards the gold can lock all our resources into physical gold. Instead, to start with it, we start with Electronic Gold Receipts. It is a movement away from physical gold and make more towards more of dematerialized assets which mimic gold and could be good for the economy. That is another thing we are working upon. Coming to the derivative, we already have approval for two more indices, which we can take for derivatives trading. At this point of time, we are working on the focused IT index. Once we become very successful, we will consider other products.

Speaker #1: That is another thing we are working upon. Coming to the derivative we already have approval for two more indices which we can take for derivatives trading at this point of time we are working on the focused ID index once we become very successful we will consider other products.

Speaker #1: Also we are in the process of in thought process of either coining or looking at some ind some index which could have a broader representation and which can help in market thinking more in terms of a bigger index pie which can be a highly representative index and also serve the needs for foreigners and other institutional investors.

Sundararaman Ramamurthy: We are in the thought process of either coining or looking at some index which could have a broader representation and which can help in market thinking more in terms of a bigger index pie, which can be a highly representative index, and also serve the needs for foreigners and other institutional investors. If you ask me what that index is, I do not have a reply at this stage. We are working on it. I am sure we will be successful very soon. This is a very broad pipeline of a lot of products that we have in our mind and we are working upon.

Speaker #1: If you ask me what that index is I don't have a reply at this stage. We are working on it. I'm sure we will be successful very soon.

Speaker #1: So, this is a very broad pipeline of a lot of products that we have in our mind and we are working upon.

Speaker #5: Thank you sir.

Operator 2: Thank you, sir.

Supratim Datta: Thank you, sir.

Speaker #2: Thank you. The next question is from the line of Prayesh Jain with Muthilal Oswald Financial Services Limited. Please go ahead.

Operator 3: Thank you. The next question is from the line of Prayesh Jain with Motilal Oswal Financial Services Limited. Please go ahead.

Operator: Thank you. The next question is from the line of Prayesh Jain with Motilal Oswal Financial Services Limited. Please go ahead.

Prayesh Jain: Hi, thank you, sir, and congratulations for the numbers. Sir, you've done a lot of efforts on improving your market share on the cash side, and we've seen some improvement. How do you see the trajectory going ahead? Also anything that you're developing towards building market share or volumes on the stock option side? Sir, that would be my question. Thank you so much, sir.

Speaker #4: Yeah hi thank you sir and congrats on a good set of numbers. So you've done a lot of efforts on the on improving a market share on the cash side and we've seen some improvement.

Speaker #4: How do you see the trajectory going ahead and also anything that you're developing towards breeding market share or volumes on the stock option side that that would be my question.

Speaker #4: Thank you so much sir.

Sundararaman Ramamurthy: Thanks for the participation, and thanks for your congratulatory message. On the cash, it has been a very long period where we are working upon. We wanted to have a meaningful presence in cash market. We have always been talking about the importance of level playing field in cash markets for us to realize the full potential and provide the market with the marketplace which makes them exchange agnostic and only price sensitive. Two important requirements for this, as we always talk about, is the common contract note and best price execution. While we have achieved common contract note regulatory as a practical use of it and the best price execution, we have some distance to cover. There are lot of artificial barriers at this point of time existing, which needs to be broken, which we feel will happen over a period of time.

Speaker #1: Thanks for the participation, and thanks for your congratulatory message. On the cash, it has been quite a very long period that we have been working upon.

Speaker #1: Where we wanted to have a meaningful presence in the cash market, we have always been talking about the importance of a level playing field in cash markets for us too.

Speaker #1: Realize the full potential and provide the market with the marketplace which makes them exchange agnostic and only price sensitive. Two important requirements for this as I always talk about is the common contract note and best price execution.

Speaker #1: While we have achieved common contract note regulatorily, as a practical use of it and the best price execution, we have some distance to cover. There are a lot of artificial barriers at this point of time existing which need to get broken, which we feel will happen over a period of time. We are very confident with the effort that we are putting in, and as acknowledged by you, our institutional volumes and cash market market share are creeping up.

Sundararaman Ramamurthy: We are very confident with the effort that we are putting and as acknowledged by you, our institutional volumes and cash market share are creeping up. We feel that it will go up further. We are also very positive with more and more listings happening in the IPO market. We are sure that our market share in cash market will go up. That is the trajectory we are planning in mind. Maybe by the beginning of the calendar year 2027, we should have touched at least a very meaningfully double-digit market share in cash market. That is the aspiration with which we are moving ahead. In terms of stock options, that is a very challenging situation at this point of time. It's a product which is not a single product, though we call it a stock option. There are 200+ stocks on which options are there.

Speaker #1: We see that it will go up further, and we are also very positive, with more and more listings happening in the IPO market. We are sure that our market share in the cash market will go up.

Speaker #1: That is the trajectory we are planning in mind. Maybe by the beginning of the calendar year 2027 we should have touched at least a very meaningfully double digit market share in cash market.

Speaker #1: That is the aspiration with which we are moving ahead. In terms of stock options that is a very challenging situation at this point of time.

Speaker #1: It is it's a product which is not a single product though we call it a stock option. There are 200 plus stocks on which options are there.

Speaker #1: And how to bring in liquidity in a product where there is no product differentiation in itself is a challenge. And more so in the underlying market liquidity in itself is making efforts to stabilize itself in a meaningful way.

Sundararaman Ramamurthy: How to bring in liquidity in a product where there is no product differentiation in itself is a challenge. More so when the underlying market liquidity in itself is making efforts to stabilize itself in a meaningful way. While it is a clear aspirational goal for us, it has some distance to be covered before we can say, Hey, look at what we have done. We have achieved it. It's aspirational. We will work towards it. In the pipeline, if you look at it, cash markets stands much ahead of stock options. Thank you so much.

Speaker #1: So while it is a clear aspirational goal for us it has some distance to be covered before we can say hey what what we look at what we have done we have achieved it.

Speaker #1: So it's aspirational we will work towards it but in the pipeline if you look at it cash market stance much ahead of stock options.

Speaker #1: Thank you so much.

Speaker #4: Thank you sir.

Prayesh Jain: Thank you, sir.

Speaker #2: Thank you. The next question is from the line of Devesh Agarwal with IIFL Capital. Please go ahead.

Operator 3: Thank you. The next question is from the line of Devesh Agarwal with IIFL Capital. Please go ahead.

Operator: Thank you. The next question is from the line of Devesh Agarwal with IIFL Capital. Please go ahead.

Speaker #4: Yeah good evening sir and thank you for the opportunity. Firstly many congratulations on great set of numbers. Sir I would like to understand the impact of the regulations on the overall volumes.

Devesh Agarwal: Yeah, good evening sir, and thank you for the opportunity. Firstly, many congratulations on great set of numbers.

Sundararaman Ramamurthy: Thank you.

Devesh Agarwal: Sir, I would like to understand the impact of the regulations on the overall volumes. There are two things basically. One is this RBI circular which went live from 1 July. How has been the impact of that on the market volumes? Is there any shift that you are seeing among the top traders themselves between domestic and foreign? Secondly, from 1 April, there was an increase in the STT that happened both in futures and options. We saw that the increase was much sharper in futures. Again, through the entire quarter, was there any shift in volume that happened from one segment to the other because of that?

Speaker #4: So there are two things basically one is this earlier circular which went live from 1st of July how has been the impact of that on the market volumes and is there any shift that you have seen among the top traders themselves between domestic and foreign.

Speaker #4: And secondly, from the 1st of April, there was an increase in the STT that happened both in futures and options. We saw that the increase was much sharper in futures, so again, through the entire quarter, was there any shift in volume that happened from one segment to the other?

Speaker #4: Because of that.

Sundararaman Ramamurthy: Thank you, Mr. Agarwal, for participation and for your kind message to us. The recent regulatory changes, as you put, one is the STT hike, and second is the RBI circular. Both were to take effect from 1 April. The second one, that is the RBI circular, was postponed, and it has started taking effect from 1 July. This period has been a period of multiple headwinds for the market. The global situation and the changing situation in geopolitical happenings on a daily basis, if not on intraday basis, combined with this an increasing volatility, have had mixing impact, making it very difficult to pin the impact to any one of the factors. Unfortunately it is a culmination of multiple things simultaneously working.

Speaker #1: Thank you Mr. Agarwal for participation and for your kind message to us. The recent regulatory changes as you put one is the STT hike and second is the RBA circular.

Speaker #1: Both were to take effect from April 1, but the second one, that is, the RBA circular, was postponed and it has started taking effect from July 1.

Speaker #1: This period has been a period of multiple headwinds for the market. The global situation and the changing situation in geopolitical happenings on a daily basis if not on intraday basis combined with this and increasing volatility have had mixed impact making it very difficult to pin the impact to any one of the factors.

Speaker #1: Because unfortunately it is a culmination of multiple things simultaneously working. Having said that the if you look at the overall market level clearly these two it is the STT combined with the RBA circular appears to have impacted the market significantly in respect of futures and to some extent in terms of options.

Sundararaman Ramamurthy: Having said that, if you look at the overall market level, clearly these two, that is the STT combined with the RBI circular, appears to have impacted the market significantly in respect of futures, and to some extent in terms of options. While that is what we can clearly tell about the overall market, as well as BSE is concerned, the futures are not very heavily traded product in BSE. We are still having some path before we can say that it is heavily traded. The impact for BSE on the futures front has been minimal. As well as the options are concerned, while there has been a minimal impact, we are not able to say whether it is because of the RBI circular for two reasons. One is, as I said, there are multiple factors.

Speaker #1: While that is what we can clearly tell about the overall market as well as BSE is concerned the futures are not very heavily traded product in BSE we are still having some path before we can say that it is really traded.

Speaker #1: So, the impact for BSE on the futures front has been minimal. As far as the options are concerned, while there has been a minimal impact, we are not able to say whether it is because of the RBA circular for two reasons.

Speaker #1: One is as I said there are multiple factors and second whether we can say the RBA circular became fully effective in respect of all bank guarantees from July 1st itself or there are remnant bank guarantees in the system which are of the past because of which we are yet to see the full impact that in itself becomes a question.

Sundararaman Ramamurthy: Second, whether we can say the RBI circular became fully effective in respect of all bank guarantees from 1 July itself, or there are remnant bank guarantees in the system which are of the past, because of which we are yet to see the full impact. That in itself becomes a question. We cannot be drawing solace from the fact there has not been much of a visible impact at this point of time in respect of BSE. More so because overall in the market, we are seeing impact on the overall volumes. That is where we stand. We need to be very carefully looking out for what is the impact in the coming months, because at that time some of the bank guarantees may mature and may not get reissued. That is a point to be noted.

Speaker #1: So we cannot be drawing solace from the fact that there has not been much of a visible impact at this point in time with respect to BSE.

Speaker #1: More so because overall in the market we are seeing impact for the overall volumes. That is where we stand. So we need to be very carefully looking out for what is the impact in the coming months because at that time some of the bank guarantees may mature and may not get reissued so that is a point to be noted.

Speaker #1: The success of this exchange, therefore, lies in making more meaningful inroads into all the other products that we talked about, starting from corporate bonds and others, which I just narrated in reply to the other caller.

Sundararaman Ramamurthy: The success of this exchange lies in making more meaningful inroads into all the other products that we talked about, starting from corporate bonds and others, which I just narrated in reply to the other call. Hope I have been able to meaningfully answer you.

Speaker #1: I hope I have been able to meaningfully answer you.

Devesh Agarwal: Yes, sir. Thank you so much.

Speaker #4: Yes sir. Thank you so much.

Speaker #2: Thank you. The next question is from the line of Madhukar with JP Morgan. Please go ahead.

Operator 3: Thank you. The next question is from the line of Madhukar with J.P. Morgan. Please go ahead.

Operator: Thank you. The next question is from the line of Madhukar with J.P. Morgan. Please go ahead.

[Analyst] (J.P. Morgan): Hi, sir. Good evening, sir. Thank you for taking my question. Most of my questions have been answered. On technology expenses, we're seeing quite a sharp pickup in this quarter, and also depreciation has come down, and also other income has also picked up quite significantly. If you could please explain these three lines, that'd be very helpful. Thanks.

Madhukar Ladha: Hi, sir. Good evening, sir. Thank you for taking my question. Most of my questions have been answered. On technology expenses, we're seeing quite a sharp pickup in this quarter, and also depreciation has come down, and also other income has also picked up quite significantly. If you could please explain these three lines, that'd be very helpful. Thanks.

Speaker #4: Hi sir. Good evening sir. Thank you for taking my question. Most of my questions have been answered just so on you know technology expenses we're seeing a quite a sharp pick up in this quarter and also you know depreciation has come down and also other income has also picked up quite significantly.

Speaker #4: If you could please explain these three lines, that would be very helpful. Thank you.

Sundararaman Ramamurthy: Technology and other income is what I heard properly. Technology has to increase the expenditure because of the simple reason from where we were, say, for example, INR 10 crore order processing per day to today INR 1,800 crore and we are talking of more and we are modernizing our system. We are changing the 80+ peripheral systems. The clearing system has gotten revamped. We are logically segregating the clearing into separate and the trading into separate. Naturally and necessarily, the other thing is the DR is equal to CR, the PR and more and more data centers. Naturally, the technology expense has to go up, is going up and in a healthy fashion. As well as other income, I would request my CFO to answer what is the specific thing. Madhukar, if I'm right, your question is regarding depreciation, right? Drop in depreciation.

Speaker #1: So technology and other income is what I heard properly. Technology has to increase the expenditure because of the simple reason from where we bear see for example 10 crore order processing per day to today 1800 crores and we are talking of more and we are modernizing our system we are changing the 80 plus peripheral systems the clearing system has gotten revamped we are logically segregating the clearing into separate and the trading into separate naturally and necessarily we are other thing is the DR is equal to CR the PR and more and more data centers naturally the the technology expense has to go up is going up and in a healthy fashion.

Speaker #1: As well as other income I would request my CFO to answer what is the specific thing. Madhukar ji if I'm right your question is regarding depreciation right dropping depreciation.

[Analyst] (J.P. Morgan): No, depreciation and other income, both, sir.

Madhukar Ladha: No, depreciation and other income, both, sir.

Speaker #4: No depreciation and other income both sir.

Deepak Goel: I can see there is not much of change in other income. I will definitely be able to explain why depreciation has come down.

Speaker #1: So, what I can see is that there is not much change in other income. I will definitely be able to explain why depreciation has come down.

Sundararaman Ramamurthy: I can see there is not much of change in other income. I will definitely be able to explain why depreciation has come down.

[Analyst] (J.P. Morgan): Actually, sir, sorry to interrupt. I meant both the investment income plus the other income that has actually moved from INR 67 crore in the previous quarter to INR 140.7 crore in this quarter. That was what I was referring to. Sorry for interrupt. Yeah.

Madhukar Ladha: Actually, sir, sorry to interrupt. I meant both the investment income plus the other income that has actually moved from INR 67 crore in the previous quarter to INR 140.7 crore in this quarter. That was what I was referring to. Sorry for interrupt. Yeah.

Speaker #4: Actually, sir, sorry to interrupt. I meant both the investment income and the other income—that has actually moved from ₹67 crore in the previous quarter to ₹140.7 crore in this quarter.

Speaker #4: So that was what I was referring to. Sorry for you know yeah.

Speaker #1: Thanks for clarifying Madhukar ji. So as BSE maintains you know diversified portfolios investment some of the investments are linked to mark to market as you know in quarter four last year due to global situation there has been significant increase in bond yields because of which some MTM lost the F2O which got reversed due to easing bond yields in this particular quarter.

Sundararaman Ramamurthy: Thanks for clarifying, Madhukar. As BSE maintains a diversified portfolio of investment, some of the investments are linked to mark to market. As you know, in Q4 last year, due to global situation, there has been significant increase in bond yields, because of which some MTM loss we had to book, which got reversed due to easing bond yields in this particular quarter. Therefore, this quarter, investment income has gone up. If you compare quarter-on-quarter, in Q4 last year, there was a drop in investment income, which has got to a large extent got compensated in this particular quarter.

Speaker #1: So, therefore, in particular, this quarter, investment income has gone up. So, if you compare quarter on quarter, in Q4 last year there was a drop in investment income, which has, to a large extent, got compensated in this particular quarter.

[Analyst] (J.P. Morgan): Got it. The depreciation part, sir?

Madhukar Ladha: Got it. The depreciation part, sir?

Speaker #4: Got it. And the depreciation part sir?

Speaker #1: So again depreciation also relates to the depreciation is computed BSE follows policy of accounting only WDV basis at the beginning of the year WDV gets reset so you would have a particular WDV at the beginning of previous year in this particular year the accumulated depreciation for the year is reduced because of which it comes down and therefore there is a reduction in quarter one.

Deepak Goel: Again, depreciation also relates to the way depreciation is computed. BSE follows a policy of accounting on a WDV basis. At the beginning of the year, WDV gets reset. As you would have a particular WDV at the beginning of previous year, with the particular year, the accumulated depreciation for the year is reduced because of which it comes down. Therefore, there is a reduction in Q1 in the depreciation.

Sundararaman Ramamurthy: Again, depreciation also relates to the way depreciation is computed. BSE follows a policy of accounting on a WDV basis. At the beginning of the year, WDV gets reset. As you would have a particular WDV at the beginning of previous year, with the particular year, the accumulated depreciation for the year is reduced because of which it comes down. Therefore, there is a reduction in Q1 in the depreciation.

Speaker #1: In the depreciation.

[Analyst] (J.P. Morgan): Got it, sir. Sorry. Thank you, sir, and all the best.

Madhukar Ladha: Got it, sir. Sorry. Thank you, sir, and all the best.

Speaker #4: Got it sir. Got it. Thank you sir and all the best.

Speaker #1: Thank you.

Sundararaman Ramamurthy: Thank you.

Speaker #2: Thank you. Ladies and gentlemen we will take that as a last question for today. I would now like to hand the conference over to Mr. Anand Sethuraman for closing comments.

Operator 3: Thank you. Ladies and gentlemen, we will take that as our last question for today. I would now like to hand the conference over to Mr. Anand Sethuraman for closing comments. Over to you, sir.

Operator: Thank you. Ladies and gentlemen, we will take that as our last question for today. I would now like to hand the conference over to Mr. Anand Sethuraman for closing comments. Over to you, sir.

Speaker #2: Over to you sir.

Anand Sethuraman: Thank you everyone for joining our call today. If you have any further questions, please feel free to reach out to us at bse.ir@bseindia.com. Thank you so much.

Speaker #1: Thank you everyone for joining our call today. If you have any further questions please feel free to reach out to us at bse.ir@bse.com. Thank you so much.

Operator 3: Thank you. On behalf of BSE Limited, that concludes this conference. Thank you all for joining us. You may now disconnect your lines.

Operator: Thank you. On behalf of BSE Limited, that concludes this conference. Thank you all for joining us. You may now disconnect your lines.

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Q1 2027 BSE Ltd Earnings Call

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