The wave of regulatory tightening in India’s derivatives market is largely over, according to the head of the country’s largest bourse.
The National Stock Exchange of India Ltd. is regaining market share in equity options as traders adapt to the stricter rules, and the bourse is seeing a pickup in commodities, Chief Executive Officer Ashishkumar Chauhan said in an interview with Bloomberg TV on Friday.
“The cycle of derivatives tightening is broadly done,” Chauhan said a day after NSE shares made their trading debut, bringing an end to the exchange’s decade-long road to going public.
The comments signal a potential turning point for NSE just as it begins life as a listed company. The market regulator’s crackdown last year on Jane Street Group, coupled with other steps to curb excessive speculation, has cooled the derivatives market that had made India the world’s leading options hub. The measures have changed the economics of a business central to the exchange’s profitability and forced NSE to scale back its valuation expectations.
The average daily notional turnover for futures and options listed on the NSE declined 10% to 193 trillion rupees ($2 trillion) in August from July, the lowest since February 2025. Meanwhile, at smaller rival BSE Ltd., it fell 34% to 154 trillion rupees.
Weekly equity options still account for about 40% of the exchange’s revenue, Chauhan said. NSE is also gaining traction in commodities, an area Chauhan sees as a growth opportunity while the bourse looks to diversify beyond equity derivatives. The bourse already offers contracts linked to crude oil and natural gas and is working with the regulator on bond-index futures and options.
That push could get a boost from the latest rule changes. The Securities and Exchange Board of India on Thursday allowed foreign investors to trade a broader range of commodity derivatives, including non-cash-settled non-agricultural contracts.
The move opens more of India’s commodity derivatives market to global funds and gives NSE an opportunity to tap a new class of investors.
“I hope many of them select NSE as their trading venue of choice for commodity derivatives,” Chauhan said.
–With assistance from Menaka Doshi, Naman Tandon and Paul Allen.
Disclaimer: This report is auto generated from the Bloomberg news service. ThePrint holds no responsibility for its content.
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