Goldman Sachs downgrades BSE's stock price target for 2nd time
What's the story
Global investment bank, Goldman Sachs, has revised its stock price target for BSE Ltd. This is the second adjustment in a week.
The firm has now set a target price of ₹4,230 per share, suggesting a potential dip of nearly 13% from its previous target price.
The revision comes after an earlier reduction on March 3 when the target was lowered to ₹4,880 from ₹5,650/share.
Market impact
NSE's change in expiry day impacts BSE
Goldman Sachs has kept a "neutral" rating on the BSE stock.
The firm cites NSE's decision to shift its expiry day for futures and options contracts from Thursday to Monday, effective April 4, as the reason behind the recent price target revision.
The move is viewed as harmful for BSE's share in the options market.
Goldman Sachs had initially expected this would increase liquidity in BSE's contracts, boosting its market share.
Market dynamics
BSE's market share gains and future projections
The brokerage firm noted that BSE gained market share in index options premiums from December 2024 to February. The gains were 16% in December, 20% in January, and 22% in February.
Goldman Sachs had predicted BSE's market share would rise to 30% by October this year, if expiry days weren't changed. However, the latest change has put a question mark on the prediction.
Stock analysis
BSE's stock performance and analyst ratings
BSE shares ended today's session at ₹4,218.95, after declining 1.86%.
Among analysts tracking the stock, eight have given a "buy" rating, two have rated it as a "hold," and one has assigned a "sell" rating.
The uncertainty over BSE's future market share has affected its stock performance.