BSE Limited: Q2 FY26 Sees Record Revenue and Robust Growth Across Segments

BSE Limited, a pivotal player in India's financial markets, has once again demonstrated robust performance, reporting its tenth consecutive quarter of record revenue in Q2 FY26. The company's topline reached an impressive Rs. 1,139 crore, marking a substantial 40% year-on-year increase. This consistent growth underscores BSE's effective strategic execution and its unwavering commitment to fostering investment opportunities across diverse market segments. The strong financial results are a testament to the company's resilient business model, which continues to thrive amidst evolving macroeconomic conditions.

The growth narrative for Q2 FY26 was predominantly driven by a significant surge in transaction-related income, particularly from the derivatives segment. This was complemented by a healthy contribution from listing-related income, which benefited from record-breaking fund-raising activities during the quarter. Furthermore, the rapid development and expansion of co-location services also played a crucial role in bolstering the company's revenue streams. The operating EBITDA, including contributions to the core Settlement Guarantee Fund (SGF), witnessed a remarkable increase to Rs. 680 crore, with margins expanding significantly from 52% to 64%. This expansion highlights BSE's enhanced operational efficiency and its ability to convert revenue growth into improved profitability.

Strategic Initiatives and Segmental Performance

BSE's strategic focus on innovation and market expansion has yielded tangible results across its various business segments. The SME platform, a cornerstone of India's entrepreneurial ecosystem, continued its robust growth trajectory. After surpassing 600 listings in July 2025, the platform now hosts 657 listed companies, collectively raising over Rs. 13,083 crore since its inception. October 2025 marked a record month, with 27 companies listing and raising Rs. 1,056 crore, underscoring the increasing confidence of investors in this segment. This growth not only facilitates capital raising but also channels funds into productive environments, supporting infrastructure development and employment generation.

The BSE StAR Mutual Fund platform also delivered an exceptional performance, reporting record revenues and an 18% year-on-year growth to Rs. 69.7 crore. The platform processed 20.1 crore transactions in Q2 FY26, a 24% increase from the previous year, with a new high of 7.13 crore transactions in October 2025. This highlights the platform's expanding reach and efficiency in mutual fund distribution. In the derivatives segment, the BSE index derivative segment sustained its growth, with an average daily premium turnover exceeding Rs. 15,000 crore. The company's efforts to increase market participation, develop new products, and adopt longer-dated contracts are expected to further drive this growth.

Key operational reforms, such as the successful implementation of the common contract note in India on June 27, 2025, have significantly streamlined trading for institutional investors, lowering costs and improving execution. Early indicators show a positive impact, with BSE volumes rising among both Domestic Institutional Investors (DIIs) and Foreign Institutional Investors (FIIs). Furthermore, the Indian Clearing Corporation Limited (ICCL), a wholly-owned subsidiary, reported strong growth, with monthly equity settled turnover tripling and equity derivatives premium turnover nearly doubling in H1 FY26, supported by major tech upgrades that scaled trades per second from 3,000 to 27,000.

Financial Prudence and Market Dynamics

BSE's management has demonstrated a proactive approach to financial prudence and risk management. The company has adopted a voluntary policy to contribute 5% of its transaction-related revenue to the core SGF on a monthly basis, capped at 150% of the minimum requirement. This measure ensures adequate risk coverage and helps smooth out potential sudden impacts on quarterly earnings due to fluctuating SGF requirements. As of October 2025, BSE's core SGF stood at Rs. 1,159 crore, with an additional Rs. 10.6 crore contributed during the quarter under this new policy.

While India's economic progress continues to gain momentum, supported by robust domestic demand and structural reforms, the market has experienced some external headwinds. Foreign institutional investors (FIIs) have been net sellers, offloading Rs. 1.29 lakh crore in Q2 FY26 and Rs. 2.5 lakh crore year-to-date. However, this selling pressure has been effectively counterbalanced by consistent buying from domestic institutional investors (DIIs), who infused over Rs. 6.3 lakh crore, reinforcing market stability. Retail investors also showed unwavering confidence, with SIP inflows through mutual funds reaching an all-time high of Rs. 29,529 crore in October 2025.

Outlook and Investor Confidence

BSE's management remains optimistic about the future, driven by a strong IPO pipeline, steady retail participation, and the growing adoption of its trading and clearing services. The company is committed to expanding its markets and products while upholding the highest standards of governance, operational simplicity, and resilience. Investments in data centers and enhanced connectivity operations are planned to further support growth. The company expects to add another 70 to 90 co-location racks by the end of the financial year, bringing the total to approximately 500 racks.

Despite the underperformance of the EbiX Insurance Platform, which management is actively reviewing, the overall strategic direction appears sound. BSE's continuous efforts in investor education and awareness, including campaigns against financial frauds, further solidify trust in the securities market. The company's ability to consistently deliver record revenues and expand its operational footprint positions it well for sustained growth, reinforcing investor confidence in its long-term value creation potential.