Weekly options ban to have limited impact on NSE financials, says CEO Chauhan
MUMBAI: The suspension of weekly options by the Securities and Exchange Board of India (Sebi) will not have a material impact on its financials, National Stock Exchange (NSE) managing director Ashishkumar Chauhan said during an investor call after the exchange’s second-quarter earnings announcement on Thursday.
“Our volumes do not depend on investors’ last-day transactions,” Chauhan said in response to investors’ question about the financial impact of weekly maturities that will be suspended by the regulator. “Our volumes are spread across almost all days, if not the last day, and so we do not see any issues going forward, regardless of Sebi’s regulations in this regard.”
On the financial coup, Chauhan explained: “It’s hard to predict, but generally speaking, we don’t see much impact of any changes that have been discussed, but this (change) may or may not happen depending on the consensus that emerges on the issue.”
Stock options are a major source of income for stock exchanges like NSE and BSE. NSE’s total standalone trading fees ₹2,760 crore in the second quarter of the current financial year (FY26), stock options accounted for 75% ( ₹2,083 crore), with equity cash and futures segments accounting for the rest.
However, Sebi is evaluating data after the second wave of reforms were introduced in July to curb retail frenzy in index options. ₹1.05 trillion to almost 9.5 million retail investors in FY25. This was higher ₹7.9 million investors suffered a loss of 748.12 billion in FY24.
Since September this year, NSE has shifted the maturity date of Nifty weekly options from Thursday to Tuesday, while BSE has shifted the maturity date from Tuesday to Thursday.
NSE on Tuesday reported a 28% sequential fall in net profit in the second quarter of FY2026. ₹2,098 crore due to one-time payment fee to Sebi for legacy colocation and dark fiber chassis. This fee is excluded ₹1,297 crore, net profit up 16% ₹3,396 crore in total revenue ₹4,160 crore.
Expiration day volumes
Data on option volumes supports Chauhan’s response at Thursday’s investor meeting that the expiry of weekly expirations will not have a significant impact on NSE’s business.
For example, total index option volumes ₹Expiration day volumes of 10.41 trillion in October accounted for only 28.5% on the four Tuesdays of the month. Expiration day volumes contributed to 32% of sales in September. ₹According to stock market data, the total volume is 9.3 trillion.
Expiry day volumes for BSE accounted for 51% of total index option volumes. ₹4.3 trillion and 42% in October ₹3.46 trillion in September, according to stock market data.
This shows that NSE volumes are relatively better spread across non-expiration days than BSEs. This is because it has an early mover advantage over its smaller rival. While NSE started offering Nifty options contracts in February 2019, BSE relaunched Sensex options in May 2023.
Limiting the enthusiasm of options
The first wave of Sebi reforms, carried out from November last year, increased contract sizes. ₹15-20 lakhs ₹5-10 lakhs and restricting exchanges to initiating only one week contract against multiple expiration earlier.
The second wave involved a change in the calculation of open interest, an indicator of money flowing into the market, from notional to delta basis to accurately reflect risk. Delta measures the change in an option’s price for each unit change in the underlying price.
The impact of these changes on investor behavior will be evaluated by Sebi before taking a decision on weekly contracts.
Speaking at the Business Standard BFSI Summit 2025 last month, Sebi chairman Tuhin Kanta Pandey said the regulator has adopted a calibrated approach after market-wide consultations to contain investors’ irrational exuberance without overwhelming the market.
Ruling out any drastic measures, he said: “Can we close the market like this? That’s a very important question?”
