BSE's stake sale in affiliate CDSL sharply boosted its net profit numbers to register a 11x growth in April-June. However, excluding the expectational item also BSE's net profit still grew 82 percent on year.
BSE's sharp rise in net profit during Q1 helped it outperform rival NSE which recorded a 9% growth in net profit during the same quarter.
Shares of BSE Ltd slumped over 6 percent in early trade on August 10 as investors took the company's positive earnings for the April-June quarter as an opportunity to book partial profits.
The stock had surged around 24 percent in the past two weeks which gave investors more leeway to take partial profits home.
At 9.59am, shares of BSE were trading at Rs 886.05 on the National Stock Exchange, down 4 percent from the previous close.
As for the company's performance in Q1, the stock exchange recorded a net profit of Rs 440 crore for the June quarter. This figure reflects a 11x surge in net profit from Rs 40 crore reported during the same quarter last year.
The steep rise in the bottomline for the quarter under review was on account of BSE's stake sale in its affiliate company, Central Depository Services (India) in June, a step taken to to meet the requirement of SEBI directives.
The stock exchange had offloaded a 5 percent stake in CDSL in June which earned the company a total of Rs 406.62 crore, boosting its bottomline higher. However, excluding this expectational gain, BSE's net profit still grew 82 percent on year, reaching Rs 72.6 crore.
Revenue also increased around 16 percent on-year to Rs 215.62 crore. BSE also made a renewed effort to invigorate the F&O (Futures and Options) segment in the quarter under review by introducing weekly options. Changes were made to the lot sizes for Sensex F&O contracts, reducing them from 15 to 10, and for the Bankex index, changing them from 20 to 15. Additionally, the expiration day for contracts was shifted from Thursdays to Fridays.
As a result of these adjustments, the stock exchange has observed a significant rise in trading volumes. The average daily turnover within the equity derivatives segment has now reached an impressive Rs 32.81 lakh crore. BSE measures turnover in terms of notional value.
Moreover, BSE's strong earnings also helped the stock exchange outperform its peer NSE, which reported a 9 percent rise in net profit for the same quarter two weeks ago.
