Growth over scale: NSE is priced at a discount to BSE

ET Intelligence group: Despite the large scale of operations and market leadership, NSE’s initial public offering appears to be priced at a discount to the listed peer BSE based on the former’s anticipated market capitalisation at around ₹5 lakh crore, reflecting a muted growth in core operations. Considering the FY26 net profit and expected market cap, NSE’s P/E multiple works out to be around 49, a significant discount to BSE’s P/E of nearly 67.

BSE’s premium valuation can be attributed to its renewed focus on the derivatives segment and strong growth in transaction revenue. Revenue from its equity derivatives segment more than doubled to ₹1,127.9 crore in the March 2026 quarter from ₹474.8 crore in the year-ago, aided by nearly two-fold jump in average daily trading lots at 151 million. Income from transaction charges rose by 87% to ₹3,795 crore from the year ago.

For NSE, it dropped by 4.3% to Rs 13,057 crore while revenue from derivatives fell by 3.7% to Rs 11,477.6 crore. As a result, NSE’s operating revenue declined by 3.1% to Rs 16,601.3 crore compared with the 63.5% increase in BSE’s operating revenue at Rs 4,834 crore.

On the margin front, NSE is ahead of BSE though the latter is fast catching up given its expanded profitability in FY26. The operating margin before depreciation and amortisation (Ebitda) for BSE increased to 64% in FY26 from 51% in the previous year while that of NSE contracted to 66.9% from 73.8% by similar comparison.

While NSE is on top when it comes to size and scale, BSE is delivering faster growth. In FY26, its net profit shot up by nearly 89% to Rs 2,497 crore whereas NSE’s profit dropped by 15.5% to Rs 12,187.6 crore.

However, NSE and BSE seem to command a higher P/E compared with the global listed peers. According to Bloomberg data, Intercontinental Exchange that owns NYSE, Euronext, Nasdaq and Hong Kong Exchange trade at P/Es between 21 and 26. London Stock Exchange commands a P/E of 38 while Japan Exchange Group trades at a multiple of 28.6.