SEBI shelves NSE's proposal to extend derivative segment timings

Capital market regulator Securities and Exchange Board of India (SEBI) has shelved National Stock Exchange’s (NSE) proposal to extend the derivative segment timings due to a lack of consensus among the broker community.

The country's largest exchange had floated the proposal to extend the equity derivatives trading time in September 2023. The plan, approved by the brokers' association Association of National Exchanges Members of India (ANMI), was proposed so that domestic traders could get insights into global events and set their trades accordingly.

As per the proposal, equity derivative trading time was proposed to extend the usual timing of 9.15 am-3.30 pm to allow an evening session from 6 pm to 9 pm in the initial phase and till 11.30 pm in the advance phase.

Ashishkumar Chauhan, MD & CEO, NSE, during an analyst call after NSE's FY24 Q4 financial results, said the "proposal is shelved" due to additional requirements for which the broker community was not able to reach a consensus, and that SEBI did not receive appropriate feedback.

NSE, in its quarterly financial result released on May 3, 2024, reported a consolidated revenue of ₹4,625 crore for Q4 FY24, up by 34% on a year-on-year basis. Apart from trading revenue, the revenue from operations was also supported by other revenue lines like data centre and connectivity charges, clearing services, listing services, index services and data services.

NSE posted a net profit of ₹2,488 crore on a consolidated basis for Q4, up by 20% YoY. The profit margins for Q4 stood at 49%. On a consolidated basis, earnings per share increased to ₹50.25 in Q4 FY24 from ₹41.72 in Q4 FY23.

On the trading volumes front, cash markets recorded an average daily traded volumes (ADTVs) of ₹1,11,687 crore (up 127% YoY) while the equity futures reached an ADTV of ₹1,79,840 crore (up 60% YoY) and equity options (premium value) ADTVs stood at ₹75,572 crore (up 27% YoY) for Q4 FY24.

On a standalone basis, NSE’s operating income was ₹4,123 crore for Q4 FY24, showing a growth of 25% YoY. It was ₹3,295 crore for the corresponding quarter last year.

The NSE said it contributed ₹43,514 crore to the exchequer for FY24, of which Securities/Commodities Transaction Tax comprised ₹34,381 crore, income tax of ₹3,275 crore, a stamp duty of ₹2,833 crore, GST of ₹1,868 crore and SEBI charges of ₹1,157 crore. Out of the STT of ₹34,381 crore, 60% is from the cash market segment and 40% from the equity derivatives segment.

In FY24, the market exchange made an additional contribution of ₹1,741 crore and NCL has made an additional contribution of ₹1,400 crore to augment the Core Settlement Guarantee Fund corpus from the current level to ₹10,000 crore as desired by SEBI. The NSE board also recommended a dividend of ₹90 per share, pre-bonus, for the year ending FY24, amounting to a pay-out of ₹4,455 crore.