Exchanges see mixed earnings in June quarter despite robust trading volumes

Uptick in gold, silver prices help recovery in commodity volumes

Domestic exchanges saw mixed earnings in the June quarter. Though trading volumes were robust, with individual investors showing increased interest in stock trading, negative crude oil pricing had an impact on commodity trading volumes.

The Bombay Stock Exchange (BSE) reported a 20 per cent dip in profit before tax (PBT) to Rs 39.8 crore in the June quarter. For the National Stock Exchange (NSE), the PBT was up by 44.4 per cent, at Rs 922.7 crore. The slump in initial public offerings (IPOs) amid the Covid-19 pandemic has been one of the factors weighing on the revenues of the BSE. Revenue from operations was down by 8 per cent in June quarter, from the corresponding quarter last year.

“Q1FY20 (the June quarter) revenue of around Rs 100 crore was below our estimate, weighed by lower listing fees and transaction charges. Listing fees were impacted due to Covid-19 (lower listings) and the BSE suspending over 1,000 default companies in Q4FY20 (which were billed and later provisioned for),” analysts at Motilal Oswal Financial Services, said in a client note.

 

 

The listing fee collection was down 10 per cent in the June quarter (at Rs 39 crore) for the BSE. Meanwhile, the NSE had a strong quarter with revenues climbing up 32.2 per cent on a YoY basis, at Rs 1,073.6 crore in the June quarter. Analysts say the NSE’s mutual fund (MF) segment is seeing traction because of its competitive pricing vis-a-vis BSE Star MF. 

The Multi Commodity Exchange (MCX) has been seeing strong traction in gold trading volumes, but the dip in crude oil volumes following negative price settlements has been a dampener. The rising interest for gold and silver led to recovery in volumes. Average daily turnover improved to Rs 35,000 crore in July, which was Rs 23,100 crore in June quarter.