Foreign Portfolio Investor Participation on BSE Surges Fivefold Amid Rising Sensex Options Activity

BSE Sees Fivefold Jump in Foreign Investor Onboarding Amid Growing Sensex Options Popularity

Asia's oldest exchange, BSE, has witnessed a significant surge in onboarding foreign investors in the past fiscal year. According to data from the Securities and Exchange Board of India (Sebi), the bourse has seen a fivefold jump in the number of foreign portfolio investors (FPIs) onboarding, with the active FPI count growing to 520 from 100 over the past fiscal year.

This growth is attributed to the increasing popularity of BSE's Sensex options, which have seen significant participation from FPIs. The bourse has declared its thirteenth straight quarter of record earnings, with a 61% year-on-year jump in net profit at ₹797.3 crore on total revenues of ₹1,630 crore in the March 2026 quarter. The surge in transaction fees on the back of higher trading volumes has been the primary driver of this growth.

BSE's Market Share in Equity Options Rises to 25.3%

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According to Sebi data, BSE's market share in equity options has risen to 25.3% in FY26 from 12.6% at the end of FY25. The remainder is held by market leader NSE. Currently, Sensex weekly options account for a significant share of BSE's equity options turnover, which stood at ₹48.2 trillion in premium terms in FY26.

The strategy now is to boost volumes in longer-dated monthly contracts—near, mid, and far-month tenors—to further expand market share. BSE's market capitalization has climbed to ₹1.56 trillion from around ₹5,000 crore when S. Ramamurthy took over as the MD and CEO in January 2023.

Growing FPI Base Deepens BSE Derivatives Market

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The surge in FPI registrations has coincided with an increase in brokers registered with BSE to 557 in FY26 from 446 in the previous fiscal. The exchange aims to onboard up to 700 brokers to broaden market participation. FPIs accounted for 3.22% of BSE's equity derivatives turnover in FY26, up from 1.95% a year earlier, according to Sebi data.

The growing FPI base is expected to deepen the BSE derivatives market, with a higher FPI count leading to increased trading activity. The exchange is launching newer indices to deepen markets, including BSE IT Focused, BSE Midcap, and BSE Sensex Next 30 indices.