NSE Reports 7% Profit Growth in Q1 FY26 as Robust Trading Activity Lifts Transaction Fee Revenue
Key Takeaways
- •NSE reported a 7% year-on-year increase in net profit for the quarter ended June 2025, driven by stronger transaction charge income from sustained trading activity.
- •The exchange recently filed its draft red herring prospectus with SEBI for a long-awaited IPO that could rank among India's largest public listings.
- •Equity derivatives contributed 57% of NSE's transaction charges, highlighting both the segment's importance and the exchange's exposure to evolving SEBI derivatives regulations.
- •NSE collected and remitted ₹18,313 crore in Securities Transaction Tax and Commodities Transaction Tax on behalf of market participants, reflecting the substantial trading volume on its platforms.
- •Non-transaction revenue streams including data connectivity charges, operating investment income, and data feed services also contributed meaningfully to the exchange's quarterly performance.
The National Stock Exchange of India (NSE) reported a 7% year-on-year increase in net profit for the quarter ended June 2025, supported by stronger transaction charge income amid sustained trading activity across its platforms.
The quarterly results arrive weeks after NSE filed its draft red herring prospectus (DRHP) with the Securities and Exchange Board of India (SEBI) for its long-anticipated initial public offering (IPO). Market observers have noted that the offering could rank among India's largest public listings. NSE had previously filed DRHP documents in 2016 but withdrew them in 2018 amid a SEBI investigation into alleged preferential access at its colocation facility, a matter that has since progressed through appellate proceedings. NSE, headquartered in Mumbai, is the world's largest derivatives exchange by number of contracts traded and operates India's predominant equity trading platform.
Key Revenue Contributors
Several non-transaction revenue streams contributed to the exchange's quarterly performance:
- Data connectivity charges: ₹258 crore
- Operating investment income: ₹234 crore
- Data feed and terminal services: ₹150 crore
Regulatory and Tax Collections
As an exchange intermediary, NSE collected and remitted substantial statutory dues on behalf of market participants during the quarter:
- Securities Transaction Tax (STT) and Commodities Transaction Tax (CTT): ₹18,313 crore
- Stamp duty: ₹980 crore
- Goods and Services Tax (GST): ₹657 crore
- Income tax: ₹373 crore
- SEBI fees: ₹256 crore
The STT and CTT collections, which are pass-through statutory levies rather than exchange revenue, nonetheless reflect the sheer scale of trading turnover routed through NSE's platforms during the quarter.
Segment-Wise Transaction Charge Distribution
Transaction charges, the exchange's core revenue driver, were distributed across trading segments as follows:
- 57% from the equity derivatives segment
- 37% from the cash delivery market
- 6% from the cash intraday segment
The dominance of equity derivatives in NSE's transaction revenue reflects the segment's outsized role in Indian market activity. NSE's benchmark index derivatives, including contracts on the Nifty 50 and Bank Nifty, are among the most heavily traded index derivatives globally. This concentration also underscores the exchange's exposure to evolving derivatives market regulations, as SEBI has over recent years implemented a series of measures aimed at strengthening risk management in index derivatives, including revisions to expiry day frameworks and lot size norms.
Source: CNBC-TV18 Markets