FTSE Russell has declared India's BSE an eligible exchange for its equity indices, marking a significant milestone for the exchange. According to reports from The Economic Times, the index provider announced on Thursday that BSE has met the criteria to be an eligible exchange for its equity indices, paving the way for BSE-listed stocks to be considered for index inclusion and potentially attracting passive fund flows. This development gives India's oldest stock exchange a similar route into FTSE Russell's eligibility framework, following the NSE which was previously the only Indian exchange eligible for inclusion in FTSE Russell indices.
Stocks listed on BSE's main board will be assessed for index eligibility from FTSE's March 2027 review, as reported by The Economic Times. Additionally, any stocks listing on the BSE main board through initial public offerings will also be eligible for fast-track screening, providing expedited consideration for new listings. The first assessment of BSE main-board stocks under the new framework will take place during the March 2027 review, allowing qualifying newly listed companies to be considered sooner rather than waiting for regular index reviews.
If a company is listed on both the BSE and the NSE and passes liquidity tests on both exchanges, the NSE-listed security will be selected for index eligibility as the exchange has more international institutional investor participation, according to The Economic Times. NSE-listed stocks are already eligible for inclusion in FTSE Russell indices, maintaining their existing eligibility status. The biggest immediate benefit could be for companies that are listed only on BSE or where the BSE listing becomes the relevant security for meeting FTSE Russell's index rules.
The NSE earlier this month announced it would add BSE to its benchmark Nifty 50 index, effective September, as reported by The Economic Times. Analysts at Nuvama estimated this integration could bring in $695 million of inflows for BSE, highlighting the potential financial impact of the exchange inclusion. The two developments highlight BSE's growing prominence in India's capital markets, with the Nifty 50 decision concerning BSE Ltd, the listed company that operates the exchange, while FTSE Russell's decision concerns the eligibility of securities listed on the BSE platform.
