BSE Ltd. shares are soaring, hitting an all-time high of Rs 2,735.20 earlier today before closing at Rs 2,693. This marks an impressive 48.89% year-to-date rally, largely fueled by the buzz around the National Stock Exchange’s (NSE) upcoming Initial Public Offering (IPO).
What’s Driving the Surge?
NSE IPO Excitement: According to Prashanth Tapse, Senior VP (Research) at Mehta Equities, a “valuation play” is unfolding. As the market anticipates the IPO of the country’s largest stock exchange, investors are naturally turning their attention to BSE, the second-largest, to realign valuations. This renewed interest is a significant factor in BSE’s recent climb.
Strong Financials: BSE’s recent financial results have been stellar. In Q4 FY25, net profit skyrocketed by 361.9% year-on-year to Rs 494.42 crore, with revenue up 75% to Rs 847 crore. The full FY25 saw net profit jump 70% to Rs 1,326 crore and revenue more than double to Rs 2,957 crore.
Market Share Gains: BSE’s index option premium market share also increased to 23.6% in April 2025, partly due to a strategic shift in its expiry day. Analysts are optimistic that BSE’s index option volumes will remain strong.
High Trading Volume: The stock was highly active today, with approximately 1.10 crore shares, worth Rs 2,964.46 crore, changing hands on the NSE.
Analyst Outlook: What’s Next?
While the rally is strong, not all analysts are predicting continued upward momentum. Anshul Jain, Head of Research at Lakshmishree Investment and Securities, suggests that BSE’s new all-time high might indicate “exhaustion on charts.” He believes a “mean reversion towards Rs 2,468” is possible, a level that aligns with a previous swing high. Jain also notes that declining volumes during the latest leg of the rally point to weakening trend strength. He identifies Rs 2,385 as a crucial support level; a breach below this could trigger a deeper correction.
Despite this, several brokerages remain bullish. Motilal Oswal has maintained a ‘buy’ rating with a target price of Rs 7,600, while Jefferies has raised its target to Rs 7,000 (keeping a ‘Hold’ rating). Nuvama Institutional Equities also has a ‘Buy’ rating with a target of Rs 7,200.
The NSE IPO: A Key Catalyst
The long-awaited NSE IPO has faced regulatory hurdles and governance issues, causing delays. However, SEBI chairperson Tuhin Kanta Pandey recently confirmed that these issues are largely being resolved, and the IPO is expected to proceed “soon.” This progress continues to fuel investor interest in the exchange sector, including BSE.
In summary, BSE shares are experiencing a significant uplift due to strong financials and the impending NSE IPO. However, investors should be mindful of potential short-term corrections indicated by some technical analyses. The ultimate success and timing of the NSE IPO will likely remain a key driver for BSE’s valuation going forward.