Mon Mar 03 04:40:00 UTC 2025: **SEBI Proposal Sends BSE Shares Plunging**

**Mumbai, March 3, 2025** – The Bombay Stock Exchange (BSE) experienced a sharp decline in its share price today following a proposed change by the Securities and Exchange Board of India (SEBI) aimed at mitigating market risks. Goldman Sachs, a global brokerage firm, slashed its target price for BSE shares by approximately 14%, contributing to the significant drop.

BSE shares fell 3.47% to close at ₹4,473.05, reaching an intraday low of ₹4,395.70 (a 5.14% decline). The downturn follows SEBI’s February 24th consultation paper outlining a new method for calculating open interest (OI) in equity derivatives. SEBI plans to replace the current notional value calculation with a futures equivalent or delta-based method. This change, SEBI argues, will reduce market manipulation. Further proposed risk management changes for the index derivatives segment are also contributing to the market anxiety.

A market expert suggests that the changes will lead to a more accurate reflection of large entities’ positions, potentially curbing manipulation in both cash and derivatives markets and reducing volatility.

Goldman Sachs anticipates that SEBI’s proposal will reduce the industry’s options premium ratio from 0.4x to 0.3x relative to cash equity turnover. This, they believe, will make it harder for the average daily premium traded on index options contracts to surpass 30% of market share (currently at 22%). The firm believes this could decrease proprietary traders’ activity, impacting BSE significantly as these traders account for approximately 70% of its average daily turnover. Consequently, Goldman Sachs lowered its target price from ₹5,650 to ₹4,880, while maintaining a neutral rating. SEBI maintains that the changes will not negatively impact smaller investors.

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