BSE Ltd shares are likely to remain in focus on Wednesday after Bernstein initiated coverage on the stock with an ‘underperform’ rating. Analysts said that the stock exchange is entering a normalisation phase after strong growth fuelled by rising retail participation in equity derivatives.
Bernstein set a target price of Rs 2,820 per share on BSE stock, implying downside of around 17 percent from Tuesday’s closing price. BSE shares closed 1.5 percent lower at Rs 3,394 on Tuesday. Despite the recent weakness, the stock remains up 29.2 percent so far in 2026, with the exchange commanding a market capitalisation of more than Rs 1.38 lakh crore.
The brokerage said retail participation has driven strong earnings growth and valuation gains for Indian exchanges in recent years. However, the equity derivatives-led retail wave is now showing signs of moderation, potentially weighing on the growth trajectory of exchanges heavily exposed to the segment.
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For BSE, Bernstein expects market-share gains to peak in FY27, with growth subsequently normalising. The view suggests that the sharp expansion enjoyed by the exchange as it built its presence in equity derivatives may become harder to sustain from here.