One index option per exchange in weekly expiry segment would make NSE choose between it’s two crown jewels i.e. Nifty or Nifty Bank. Assuming speculation market size to remain the same [i.e. INR 10,000 crores index option market], BSE which now makes INR 1,200 cr would gain market share with some speculators shifting the trade from NSE delisted index options [w.e.f 20 November 2024] to BSE.
Mental models:
- expected market share gains;
- risk reward seems in favor [FY’25 expected PAT 1100-1200 crores; PE [FY’25]: 45-50]- this is without factoring market share gain]
- Breakout with huge volumes
EDIT:
To monitor:
- Loss in revenue due to increase in lot value and delisting of one index option by BSE (current has 2) is lesser than increase in revenue due to market share gains from NSE
Useful link: watch from 7:50 timestamp
Disclosure: holding