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, Piramal Pharma, Tata Technologies, and Torrent Power from May 4, 2026, following SEBI eligibility criteria review.

Summary

BSE has notified trading members that Futures and Options contracts for four securities — Housing & Urban Development Corporation Ltd (HUDCO), Piramal Pharma Ltd, Tata Technologies Ltd, and Torrent Power Ltd — will be discontinued from the Equity Derivatives Segment effective May 4, 2026. This action is in accordance with SEBI’s revised eligibility criteria for stocks in the derivatives segment (SEBI Circular dated August 30, 2024 and BSE Notice dated September 2, 2024).

Key Points

• F&O contracts for all four securities will cease trading from May 4, 2026
• No new expiry month contracts will be generated for these securities after the discontinuation date
• Existing unexpired contracts for February, March, and April 2026 will continue to trade until their respective expiry dates
• The exclusion is triggered by SEBI’s revised eligibility criteria for entry/exit of stocks in the derivatives segment
• Derivatives Asset Codes affected: HUDC, PPHL, TTCH, TORP

Regulatory Changes

This circular implements SEBI Circular Ref. No. SEBI/HO/MRD/MRD-PoD-2/P/CIR/2024/116 dated August 30, 2024, which revised the eligibility criteria for stocks in the derivatives segment. BSE Notice No. 20240902-3 dated September 2, 2024 had further detailed the review framework for entry/exit of stocks. These four securities have failed to meet the updated eligibility thresholds and are therefore being removed from the derivatives segment.

Compliance Requirements

• Trading members must cease initiating new positions in these securities’ F&O contracts for expiry months beyond April 2026
• Members must inform their clients holding positions in these contracts about the discontinuation timeline
• No new expiry month contracts beyond April 2026 will be available for these securities
• Existing positions in February, March, and April 2026 contracts can be held, squared off, or allowed to expire normally

Important Dates

Impact Assessment

Traders and investors with open or planned F&O positions in HUDCO, Piramal Pharma, Tata Technologies, or Torrent Power are directly impacted. Market participants using these derivatives for hedging underlying equity positions will need to identify alternative hedging instruments. The discontinuation may reduce liquidity in existing contracts as the expiry dates approach, potentially widening bid-ask spreads. Institutional investors using these stocks in derivative strategies will need to reassess their portfolios. The removal from the derivatives segment may also have a secondary sentiment effect on the underlying equity prices of these four companies.

Impact Justification

Affects active F&O trading in 4 widely-traded securities; traders holding or planning positions in these contracts must adjust strategies before May 4, 2026 discontinuation.