• Source:PTI
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BSE Stock: Mumbai Stock Exchange (BSE) shares fell by 18 percent today after being told to pay SEBI regulatory fees based on the annual turnover computed from the 'notional value' of its option contracts. This is the largest drop since the stock's listing, and it is also the biggest single-day decline since 2017. Meanwhile, The Multi Commodity Exchange of India Limited (MCX) shares also fell by 7% in early trade following the SEBI directive.

The notional value of an option contract is the market price of the underlying asset multiplied by the specific amount of the contract. For instance, if an option contract represents 100 shares of a stock valued at 50 rupees, the notional value would be 5,000 rupees. BSE calculated the annual turnover based on the premium price for option contracts. In this, regulatory fees for the past period along with interest will be paid.

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What is the premium price?

The premium price is the price at which the option holder has the right to buy or sell the underlying assets at a predetermined price on a specified date. The BSE has been asked to pay differential fees of ₹165 crore. Of this, ₹69 crore is for FY 2007 to 2023 and ₹96 crores is for FY 2024. BSE's peer MCX has also been asked to pay a differential fee of ₹4.43 crore.

Brokerage firm Jefferies wrote in its note that derivatives make up about 40% of profit estimates for fiscal years 2025 and 2026 and higher charges could impact its earnings per share (EPS) by 15% to 18%.

Brokerage Firm reduced rating

Jefferies downgraded the stock to "Hold" from an earlier "Buy" rating and cut its price target to ₹2,900 from ₹3,000 earlier. It has cut its fiscal year 2025 and 2026 projections by 6% to 9%. Let us tell you that BSE shares are trading at ₹ 2,838, falling by more than 11% around 11 am. Despite the decline, the stock has increased by more than 437% in a year.

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