Release Date: May 08, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- BSE Ltd (NSE:BSE, Financial) recorded its strongest year in history with a record revenue of INR 1,618 crores, up 70% compared to the previous financial year.
- The company saw a significant increase in registered investors, growing by 41% from INR 12.1 crores to INR 17.1 crores.
- BSE Ltd (NSE:BSE) successfully relaunched its index options segment, contributing to strong results in equities, mutual funds, and clearing and settlement business.
- The company conducted 13,780 investor awareness programs and utilized digital and social media to spread awareness, reaching over 4.5 crore active investors.
- BSE StAR MF delivered record revenues and performance, up 63% year-on-year, processing 41.1 crore transactions in FY '24.
Negative Points
- BSE Ltd (NSE:BSE) faced a significant increase in clearing and settlement charges, incurring a cost of INR 206.5 crores compared to INR 61.7 crores in the previous year.
- The company had to provide INR 170 crores towards differential regulatory fees due to a letter from SEBI regarding past periods' regulatory fees.
- Despite strong revenue growth, the company had to contribute INR 91.7 crores towards Core SGF, which is 67% higher compared to the previous financial year.
- The company faces challenges in maintaining profitability due to high clearing and settlement charges and regulatory fees.
- There were concerns about system stability on specific dates, leading to issues with stop-loss orders not getting triggered, impacting trader confidence.
Q & A Highlights
Q: What is the current market share in futures and options for this quarter, and how do you measure it? Similarly, what's your market share for the StAR MF in Q4?
A: In respect of derivatives, we do not measure market share in the traditional way due to product differences. Our focus is on the number of members, investors, and foreign participants trading. For StAR MF, our market share remains around 85% to 90%.
Q: What are the key differences between the current BSE StAR MF platform and the upcoming StAR MF 2.0?
A: The new platform will be modular, enhancing functionality, features, resilience, governance, sustainability, and growth. It will provide better stability and functionality for market growth.
Q: Do you expect any impact on volumes due to the tariff increase effective from May 13th?
A: The tariff increase is essential to cover high clearing and settlement costs and SEBI turnover fees. The charges are now in line with market rates, and while market forces will decide the impact, we believe it was necessary for market growth.
Q: What steps are being taken to increase the premium to notional ratio in options trading?
A: We are encouraging institutional players with longer-term views to deepen and broaden the market. Providing colocation services will also help institutional players execute their strategies, improving the premium to notional ratio.
Q: Is there any update on the merger of the exchange at GIFT City, given the dwindling volumes?
A: GIFT City is crucial to us, and we are committed to its growth. We are working on strategies to increase volumes and ensure the exchange flourishes.
Q: What was the issue on February 2nd and April 12th, 2024, when stop-loss orders did not get triggered?
A: The issue was due to sudden market volatility, not system stability. We have introduced measures like Limit Price Protection to smoothen such movements and will continue to enhance our surveillance mechanisms.
Q: How is the utilization of the data center and colocation services tracking, and what are the plans for the next 1-2 years?
A: We have started collecting rent for colocation racks to cover costs. We plan to add 150 more racks based on market demand and will continue to expand as needed.
Q: What is your view on the impact of NSE launching NIFTY Next 50 on Fridays, which was exclusive to BSE?
A: Initially, product differentiation helped us gain momentum. However, with high correlation between indices, we believe multiple products will coexist, allowing for diverse trading strategies and market growth.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
