March 22, 2023
New Delhi, India
BSE Shares Surged By 8%
In a significant development, the share price of the Bombay Stock Exchange (BSE) witnessed a remarkable surge of nearly 8% today following a rating upgrade from brokerage firm Investec. Here are the key highlights from this event:
Rating Upgrade and Target Price: Investec upgraded its rating for BSE shares to “Buy” and assigned a target price of ₹2,800 per share, implying an impressive upside potential of nearly 38% from Wednesday’s closing price. This bullish outlook reflects Investec’s confidence in BSE’s growth prospects and market performance.
Reasons for the Upgrade: Investec highlighted BSE‘s strong traction in equity derivatives volumes, particularly noting a significant increase in its options market share, which surged 3x on a quarter-on-quarter basis to over 15% in March. The brokerage firm anticipates further market share gains, driven by the rapid scale-up of BSE’s BANKEX product.
Financial Performance and Outlook: BSE has demonstrated robust financial performance, with its net profit doubling to ₹108.2 crore in the quarter ended December 2024 compared to the year-ago period. Additionally, the bourse reported its highest quarterly revenue ever at ₹431.5 crore in Q3FY24, marking a substantial 76% increase year-on-year. Investec also noted BSE’s efforts to reduce clearing charges paid to NSE, expecting improved margin profiles in Q4FY24 as metrics stabilize.
Also Read: US Federal Reserve Keeps Interest Rates Unchanged; Signals Expectation of Rate Cuts in 2024
Market Reaction
The announcement of the rating upgrade propelled BSE shares to spike by nearly 8% to a high of ₹2,194.95 apiece on the National Stock Exchange (NSE). This surge underscores investors’ positive response to Investec’s bullish outlook on BSE’s growth trajectory and financial performance.
Investors and market participants are closely monitoring developments surrounding BSE, anticipating further market dynamics and potential opportunities in line with Investec’s optimistic projections.
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