NSE Q3 Results: Profit Jumps 22% On Protean Stake Sale, Revenue Falls As Volumes Decline

The National Stock Exchange of India Ltd. reported a 22% quarter-on-quarter increase in its bottom line due to a one-time gain of Rs 1,155 crore even as revenue fell 4% in the same period for the quarter ended Dec. 31.

The company, which is eyeing an initial public offering, also saw its operating profit rise 2% on the quarter to Rs 3,398 crore. The margin of the operating earnings before interest, taxes, depreciation, and amortisation rose to 78% from the previous quarter's 74%.

The consolidated revenue from transaction charges for the third quarter stood at Rs 3,445 crore, a sequential decline of 4%. This was mainly due to a reduction in volumes across cash market and derivatives segment, NSE said.

To put things in perspective, the Indian market regulator, SEBI, in a bid to curb excessive speculation in equity derivatives, proposed new measures in July 2024, including increasing the lot size and mandating the upfront collection of option premiums from buyers by trading members and clearing members.

Due to a fall in volumes, the exchange's trading revenue fell 2% to Rs 3,975 crore while clearing revenue fell 16% to Rs 641 crore on a sequential basis.

NSE's profit saw a 22% increase despite a modest 2% growth in operating Ebitda mainly on the back of the one-time gain of Rs 1,155 crore through the sale of its entire 20.3% stake in Protean e-Gov Technologies Ltd.

In the September quarter, the exchange also had a writeback of Rs 426 crore as contribution, net of provision reversal, to the its core settlement guarantee fund. The core settlement guarantee fund is maintained by NSE Clearing to ensure that trades are settled on time. It is used to fulfill obligations of a clearing member who fails to settle on time.