NSE vs BSE: Which exchange leads on revenue, profit and growth ahead of NSE IPO?

NSE IPO has moved one-step closer to its market debut after National Stock Exchange of India (NSE) filed its Draft Red Herring Prospectus (DRHP) with market regulator SEBI for its public offering.

The proposed NSE IPO is complete offer-for-sale (OFS) of up to 14.89 crore equity shares by existing shareholders of NSE. Meanwhile, the shares will be listed on BSE, similar to BSE's own shares being listed only on NSE.

State Bank of India (SBI), MS Strategic (Mauritius) Ltd, Canada Pension Plan Investment Board (CPPIB), Aranda Investments (Mauritius) Pte Ltd, Bank of Baroda, Stock Holding Corporation of India, General Insurance Corporation of India (GIC Re), New India Assurance, National Insurance Company and United India Insurance Company are some of the key selling shareholders in NSE IPO.

NSE and BSE together virtually control 100% of the organised stock and derivatives trading market in India. Both companies operate as a duopoly business and compete with each other for market share.

How does NSE and BSE earn revenue?

NSE and BSE earn their revenue through multiple streams. Transaction charges remain the largest source of revenue. However, exchanges also generate meaningful income from listing fees, market data, index licensing, technology services, clearing and settlement.

Stock exchanges operate a very sophisticated and unique business model, earning revenue from diversified segments. The companies that make market debut pay listing fees and annual listing fee to the exchanges. Investors place buy/sell bids that also generate transaction revenue. Brokers use market data feeds and exchange technology, for which they pay fees. The trade is cleared and settled, generating clearing income. Index licensing fees from mutual funds and ETFs. Meanwhile, the exchanges invest their cash reserves and earn interest income.

FY26 revenue breakdown

Key notes:

• FY26 revenue of NSE is over 3.5 times higher than BSE despite a year-on-year decline. Meanwhile, NSE net profit is over 4 times more than BSE net profit.

• NSE remained India's largest stock exchange by scale, reporting FY26 revenue of ₹16,601 crore and net profit of ₹10,302 crore. Although, the revenue declined 3.1% YoY and PAT fell 15.4% mainly due to high base.

• NSE dominates cash market trading, with an average daily trading volume of ₹1.05 lakh crore, compared to ₹7,950 crore on BSE, highlighting its overwhelming market share in equity trading.

• NSE also has higher market share in the derivative segment compared to BSE.

• In FY26, NSE earned ₹13,057 crore from transaction charges and ₹352 crore from listing service.

• Meanwhile, BSE earned ₹3,795 crore from transaction charges and ₹519 crore from listing service. These two revenue segments has the highest weightage in total revenue.

• NSE and BSE each hosted over 100 mainboard IPOs during FY26, while BSE continued to strengthen its leadership in the SME IPO segment with 146 SME listings.

• Another key metric i.e. PAT margin is higher for both NSE and BSE. This is mainly due to zero marginal cost to process additional trades. These companies have already set up their core technology and infrastructure. Hence, every additional trade generates revenue with no extra operating cost.

Disclaimer:

The stock discussed in this article is only for educational purposes and not a buy or sell recommendation. Investors are advised to conduct their own analysis and risk due diligence before trading and investing in the stock market. Investments in the securities market are subject to market risk. Read all the related documents carefully before investing.