India’s stock market is anchored by two major exchanges—the NSE and the BSE—but their roles differ sharply for long-term investors considering investing in them. While BSE carries legacy and breadth, the NSE stands out with higher liquidity, faster execution, and stronger dominance in derivatives and benchmark indices like Nifty 50 and ranked in top 5 stock market exchange globally.
So does NSE offer better opportunity vs BSE, or other listed players – with NSE IPO in horizon soon ! Assume an IPO price of 1900 – 2000, let’s deep dive into numbers and facts !
|
Feature |
National Stock Exchange (NSE) |
Bombay Stock Exchange (BSE) |
|
Founded |
1992 |
1875 |
|
Origin |
Created as a modern, electronic marketplace to improve transparency |
Started as the Native Share and Stock Brokers’ Association |
|
Status |
Largest financial market in India |
First and oldest stock exchange in India (and Asia) |
|
Global Ranking |
7th largest exchange worldwide (by market capitalization, May 2024) |
Among the largest globally; biggest in India by market capitalization (May 2024) |
|
Market Capitalization (Dec 25) |
~ 4.8 lakh crore |
~1.1 lakh crore |
|
Key Strengths |
High liquidity, advanced technology, ease of trading, liquid derivatives market, |
Wide company listings, strong role in developing capital markets |
|
Number of Listed Companies |
Fewer compared to BSE; focuses on large, liquid stocks |
Nearly 6,000 companies listed, including many SMEs |
|
Popular Index |
NIFTY 50 (tracks top Indian companies) |
SENSEX (tracks 30 major companies) |
|
Markets Covered |
Equity and wholesale debt markets |
Equities, debt instruments, derivatives, SMEs |
|
Innovation |
First fully automated electronic trading platform in India |
First stock exchange in Asia; pioneer in Indian capital markets |
Though NSE is much bigger than BSE financially, BSE shares have been on the run in past 3 years. In-fact, FY 24-25, was the breakout year for BSE financially, and stock price runup reflecting the same too (see below).
*Source : nseindia.com, tradingview
BSE’s FY25 performance shows explosive growth, but NSE remains the more stable and profitable investment—at least for now. Here’s a detailed breakdown of how the Bombay Stock Exchange (BSE) and National Stock Exchange (NSE) stack up in H1-FY26, on various parameters.
Metric | NSE (H1 FY26) | BSE (H1 FY26) |
Revenue from Operations | ₹7,709 Cr (▼15% YoY) | ₹2,112 Cr (▲56% YoY; doubled from H1 FY25) |
Total Income | ~₹8,000 Cr (including other income) | ~₹2,100 Cr |
Net Profit (PAT) | ₹5,022 Cr (▼12% YoY; impacted by SEBI provision) | ₹1,096 Cr (▲61% YoY) |
Operating EBITDA | ~₹5,092 Cr normalized (▼11% YoY) | ₹1,252 Cr (▲122% YoY) |
EBITDA Margin | ~77% normalized | ~65% |
Key One-Time Items | -₹1,297 Cr SEBI settlement provision; +₹1,201 Cr NSDL stake sale | None reported; growth driven by derivatives & MF platform |
With NSE current market price hovering around 1925, vs. BSE share price around 2700 – let’s see how they stack up in terms of valuations.
Metric | NSE | BSE |
Market Capitalization | ₹4,80,000 Cr | ₹1,10,000 Cr |
P/E Ratio | ~ 39.1 | ~ 61 (5yr average P/E ~51) |
P/B Ratio | 15.7 | 21.1 |
ROE, % | 40% | 36% |
Dividend per Share | 35 (71% payout ratio) | 23 (24% payout ratio) |
Forward P/E (FY-26E) | 37 (PAT of 11,000 Cr) | 42 (PAT of 2200 Cr) |
Although BSE has shown strong growth, the figures indicate it could be moving into overvalued territory—particularly when NSE, the market leader, is available at a far more appealing valuations to investors.
BSE wins the sprint, while NSE is poised to WIN the marathon
Way Ahead : Indian stock market poised for a phenomenal run with in future, driven by retail investors – capital stock markets will follow. Wit the impact of shift in option expiry date starting to play out from Q3’26 onwards, NSE entering electricity futures market, expansion in GIFT city to attract more foreign inflows, at the same time, considering the overhang of SEBI’s further restriction on options market in future – NSE seems to be in a better positioned than BSE for long term investors, while BSE offers better reward opportunity in short term.
Watch Out for the Q3 results now!
Disclaimer: This article is for information purpose only. It is NOT a stock recommendation and should not be treated as such. Please consult your financial advisor before investing. Investing in securities market is subject to market risks. I have a personal holding in NSE (< 1%). Please read full disclosures here.
