FTSE Recognition Of BSE Could Open A Global Index Route For NSE Shares

FTSE Russell's decision to recognise the Bombay Stock Exchange (BSE) as an eligible exchange for its global equity indices may not immediately change much for most large Indian companies. But the development could become more significant for the National Stock Exchange (NSE) as it moves closer to its much-awaited listing.

Last month, FTSE Russell said that securities listed on the BSE main board would become eligible for assessment for its global equity indices from its March 2027 review. Newly listed companies that do not qualify immediately may also be considered through the fast-track screening process.

Why The Change Matters More For NSE

For most major Indian stocks, the change is unlikely to have much practical impact. Large companies listed on the NSE are generally listed on the BSE as well and are already eligible for FTSE Russell's indices.

The situation could be different for NSE shares themselves.

NSE, which is the world's largest derivatives exchange by number of contracts traded, is expected to enter the listed market soon after receiving final regulatory approval for its public issue.

The proposed IPO is expected to be worth around ₹30,000 crore, and NSE shares have already attracted considerable interest in the unlisted market ahead of the offering.

March 2027 Review Could Be An Important Milestone

If NSE lists as expected, its shares could have roughly six months of trading history on the BSE by the time FTSE Russell conducts its March 2027 review.

That period could also help the stock satisfy the minimum listing history requirement for consideration in certain BSE indices.

However, a place in an index will not come automatically.

NSE shares would still need to meet the eligibility criteria laid down by the respective index providers. Factors such as float-adjusted market capitalisation, liquidity, traded value and trading frequency would all be considered.

Given the level of investor interest surrounding the exchange, the stock could build sufficient trading volumes after listing. FTSE Russell's recognition of the BSE removes an exchange-related obstacle that might otherwise have stood in the way of NSE shares being assessed for global benchmarks.

What Index Inclusion Could Mean For NSE Shares

Getting included in a widely tracked international index can bring a new set of investors to a stock.

Global institutional investors and passive funds often use benchmark indices to determine where to allocate capital. If NSE eventually meets the criteria for inclusion in such indices, it could potentially attract incremental institutional demand for its shares.

For now, FTSE's decision does not guarantee index inclusion for NSE. But as the exchange prepares to become a listed company, the recognition of the BSE gives NSE shares another possible route into global equity benchmarks.

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