Exclusion of Futures and Options Contracts of 4 Securities from BSE Equity Derivatives Segment

Description

BSE announces discontinuation of F&O contracts for Housing & Urban Development Corporation Ltd, Piramal Pharma Ltd, Tata Technologies Ltd, and Torrent Power Ltd from May 4, 2026, following SEBI eligibility criteria review.

Summary

BSE has announced the discontinuation of Futures and Options (F&O) contracts for four securities from the Equity Derivatives Segment effective May 4, 2026. This action is pursuant to SEBI Circular No. SEBI/HO/MRD/MRD-PoD-2/P/CIR/2024/116 dated August 30, 2024, and BSE Notice No. 20240902-3 dated September 2, 2024, regarding revised eligibility criteria for stocks in the derivatives segment.

Key Points

• F&O contracts for four securities will be discontinued from trading in the Equity Derivatives Segment from May 4, 2026
• No new expiry month contracts will be generated for these securities after the discontinuation date
• All existing unexpired contracts will continue to trade until their respective expiry dates
• The action follows SEBI’s revised eligibility criteria for entry/exit of stocks in the derivatives segment
• Trading members are formally notified to adjust positions accordingly

Affected Securities

Regulatory Changes

This exclusion is based on SEBI Circular Ref. No. SEBI/HO/MRD/MRD-PoD-2/P/CIR/2024/116 dated August 30, 2024, which set revised eligibility criteria for stocks in the derivatives segment, and BSE Notice No. 20240902-3 dated September 2, 2024, which outlined the review mechanism for entry/exit of stocks. The four securities have failed to meet the updated eligibility criteria and are therefore being removed from the derivatives segment.

Compliance Requirements

• Trading members must note that no new positions can be created in contracts expiring on or after May 2026 for the listed securities
• Members should inform clients holding open positions in these F&O contracts to plan their exit strategies before respective expiry dates
• No fresh contract series will be introduced for these securities post the discontinuation date

Important Dates

• February 26, 2026 – Expiry of existing February 2026 contracts
• March 25, 2026 – Expiry of existing March 2026 contracts
• April 30, 2026 – Expiry of existing April 2026 contracts
• May 4, 2026 – Effective date of discontinuation; no contracts available for trading from this date onward

Impact Assessment

This circular has significant implications for market participants actively trading F&O contracts on HUDCO, Piramal Pharma, Tata Technologies, and Torrent Power. Traders and institutional investors holding positions must wind down or roll over existing contracts before the April 30, 2026 expiry. The removal from the derivatives segment may reduce liquidity and hedging options for these stocks in the cash market. Participants should monitor open interest and volume closely as the expiry dates approach, as reduced participation could increase impact costs. This is a routine but impactful regulatory action aligned with SEBI’s ongoing effort to ensure only eligible and liquid stocks remain in the derivatives segment.

Impact Justification

Affects active F&O contracts of 4 publicly traded securities; traders holding positions must plan exits before respective expiry dates, with no new contracts from May 4, 2026.