Goldman Sachs has recently revised its price target for Bombay Stock Exchange (BSE) shares, expressing concerns over escalating competition in the market. This adjustment marks the second consecutive cut in BSE’s price target within a short span. The global brokerage firm reduced the price target by over 13%, citing worries about market share dynamics following changes in the National Stock Exchange’s options expiry days.

The alteration in expiry days, executed at the beginning of 2025, has notably impacted BSE’s options market share. While BSE retained Tuesday as its expiry day, the National Stock Exchange shifted to Thursday, resulting in a significant impact on weekly options contract expiries. Initially, BSE witnessed a surge in its share of index options premium from December 2024 to January and February 2025. However, Goldman Sachs observed that the anticipated growth in liquidity for BSE’s contracts did not materialize as expected. Despite an initial increase, the firm now projects a more uncertain outlook for BSE’s market share in the options segment.

Options trading plays a pivotal role in BSE’s revenue, contributing nearly half of its total income. The recent adjustments in expiry days by rival exchanges have raised concerns about BSE’s ability to maintain its market share amidst fierce competition. Following the news of the price target cut by Goldman Sachs, BSE shares experienced a 3.5% decline in the last trading session, reflecting investor concerns about potential market share losses.

In response to the changes in expiry days announced by the National Stock Exchange, market experts anticipate shifts in trading patterns, potentially leading to increased activity on Fridays as traders seek to close positions before the weekend. Analysts view NSE’s strategic move as an attempt to regain market share in the options segment, where BSE had made recent advancements. The competition for liquidity and trading volumes in the derivatives market poses a significant challenge for BSE, given the substantial contribution of options trading to its revenue stream.

The evolving landscape of the stock exchanges and the adjustments made by key players like BSE and NSE underscore the competitive nature of the financial markets. As these exchanges navigate market dynamics and strive to maintain their positions, investors closely monitor developments to assess the potential impact on stock performance and market stability. The recent revisions in BSE’s price target and the shifts in expiry days highlight the importance of adaptability and strategic positioning in the dynamic realm of stock trading.