Description

BSE announces discontinuation of derivatives contracts for CYIENT, HFCL, NCC, and TITAGARH RAIL SYSTEMS from December 26, 2025, following SEBI eligibility criteria review.

Summary

BSE has announced the exclusion of Futures and Options contracts for four securities from the Equity Derivatives Segment effective December 26, 2025. This action is taken in accordance with SEBI Circular SEBI/HO/MRD/MRD-PoD-2/P/CIR/2024/116 dated August 30, 2024, regarding stock eligibility criteria. The affected securities are CYIENT LIMITED, HFCL LIMITED, NCC LIMITED, and TITAGARH RAIL SYSTEMS LIMITED. No new expiry month contracts will be generated for these securities.

Key Points

  • Four securities will be removed from equity derivatives trading: CYIENT (532175), HFCL (500183), NCC (500294), and TITAGARH RAIL SYSTEMS (532966)
  • Discontinuation effective from December 26, 2025
  • No new expiry month contracts will be generated for these securities
  • Action follows SEBI eligibility criteria review outlined in circular dated August 30, 2024
  • Existing unexpired contracts will continue until their respective expiry dates
  • Trading members must prepare for the transition and manage existing positions

Regulatory Changes

This circular implements the eligibility criteria framework established by SEBI Circular Ref. No: SEBI/HO/MRD/MRD-PoD-2/P/CIR/2024/116 dated August 30, 2024, and BSE Notice no 20240902-3 dated September 02, 2024. The regulatory framework provides for periodic review of stocks’ eligibility to remain in the derivatives segment based on specified criteria including liquidity, market capitalization, and trading volumes.

Compliance Requirements

For Trading Members:

  • Monitor and manage existing derivatives positions in the four affected securities
  • Ensure clients are informed about the discontinuation of new contracts
  • Plan position rollovers or closures before contract expiry dates
  • Update trading systems and risk management frameworks to reflect the exclusion
  • Cease opening new positions in contracts beyond December 2025 expiry

For Investors:

  • Close or rollover existing positions before respective expiry dates
  • Adjust hedging strategies for underlying equity holdings in these securities
  • Consider alternative risk management instruments if holding these stocks

Important Dates

  • October 30, 2025: Expiry of October 2025 contracts for affected securities
  • November 27, 2025: Expiry of November 2025 contracts for affected securities
  • December 24, 2025: Expiry of December 2025 contracts for affected securities
  • December 26, 2025: Complete discontinuation - no contracts available for trading in the four securities
  • Notice Date: October 24, 2025

Impact Assessment

Market Impact:

  • Derivatives traders and hedgers using F&O contracts in these four stocks must find alternative strategies
  • Potential increase in volatility in the underlying equity securities as derivatives-based hedging becomes unavailable
  • Reduced liquidity in the derivatives segment for these specific securities
  • Market participants with open positions need to plan exit or rollover strategies

Operational Impact:

  • Trading members must update their systems and remove these securities from derivatives trading platforms post-December 26, 2025
  • Risk management and margin systems require reconfiguration
  • Client communication and education required regarding position management

Investor Impact:

  • High impact on traders using these derivatives for speculation or hedging
  • Institutional investors using F&O for portfolio hedging must explore alternatives
  • Reduced trading flexibility for investors holding underlying equity positions in these stocks
  • Need to reassess risk management strategies for portfolios containing these securities

Impact Justification

Impacts active derivatives traders in four stocks with immediate effect on trading strategies and positions. Complete discontinuation of F&O contracts affects hedging and speculation activities.