BSE Stock Price Falls Following Sebi’s Regulatory Fee Diktat


by Sandip Das on 29 April 2024,  3 min read


The Bombay Stock Exchange (BSE) is poised to face an augmented regulatory fee burden following the Securities and Exchange Board of India (SEBI)’s directive to calculate the fee based on the “notional value” of its options contracts rather than their premium value.

This directive has stirred a significant reaction in the market, evidenced by a sharp decline in BSE shares, plummeting by as much as 18.64 percent to an intra-day low of Rs 2,612 on the National Stock Exchange (NSE) on Monday.

Industry analysts foresee a surge in BSE’s regulatory fee payments to SEBI due to the substantial disparity between notional and premium values. This discrepancy emanates from the calculation methodology, which involves multiplying the contract size by the underlying price.

Notional turnover encapsulates the aggregate strike price of all contracts traded in derivatives, while premium turnover represents the total premiums paid on all traded contracts. Given that the notional value surpasses premium turnover, adopting notional turnover as the basis results in a higher fee outflow.

Also read: Why Apollo Hospitals Share Price Tumbled?

In response to this development, BSE, in a filing to the NSE on Friday, acknowledged SEBI’s directive, affirming its intention to comply. The exchange has been instructed to remit the regulatory fee based on annual turnover to SEBI, factoring in the notional value for options contracts.

Moreover, BSE has been tasked with remunerating the differential regulatory fee for preceding periods, coupled with a 15 per cent per annum interest on the outstanding amount. It has been given a one-month timeframe to fulfill this obligation, as outlined in the filing.

If the determined amount is deemed payable, BSE estimates the total differential SEBI regulatory fees for the period spanning from fiscal year 2006-07 to fiscal year 2022-23 to amount to Rs 68.64 crore plus GST, inclusive of Rs 30.34 crore in interest. Furthermore, the potential differential SEBI regulatory fees for fiscal year 2023-24 could approximate Rs 96.30 crore plus GST, contingent upon liability, as disclosed by BSE.

This regulatory recalibration underscores the evolving landscape of market oversight and the intricacies involved in fee computation methodologies. As BSE navigates these regulatory waters, the impact on its financial performance and market positioning remains a focal point for stakeholders and market participants alike.

Source: Indian Express

Dhanush powered by Ashika Group, is one of the best online trading app in India which gives a flawless and smooth trading experience. Get solid research analysis, data-driven approach, customer-centric service philosophy, trust-based advice & competitively priced products. Click here for more stock market blogs.

For more insightful articles and updates, follow us on Facebook and Instagram.

Disclaimer: The information provided in this blog post is for informational purposes only and should not be construed as investment or trading advice. The author is not a financial advisor and does not have any professional qualifications in this area. The author does not guarantee the accuracy or completeness of the information provided. Any action you take based on the information in this blog post is done at your own risk. Please consult with a financial advisor before making any investment.

How useful was this post?

Click on a star to rate it!

Average rating 0 / 5. Vote count: 0

No votes so far! Be the first to rate this post.

Spread the love