NSE shares have a 54% ‘bull case’ upside as per Motilal Oswal, who recommends ‘buy’

Brokerage firm Motilal Oswal has initiated coverage on the National Stock Exchange (NSE) with a ‘Buy’ rating and a one-year price target of ₹2,300 per share. The target implies an upside potential of around 19% from the current market price.

The brokerage has also outlined a bull-case scenario that indicates a potential upside of 54%.

Motilal Oswal said NSE is India’s largest stock exchange by trading turnover in both the cash and equity derivatives segments. In FY26, the exchange recorded an average daily traded turnover (ADTO) of ₹1.1 lakh crore in the cash market, while equity futures ADTO stood at ₹1.6 lakh crore. The average daily premium turnover in equity options was ₹57,700 crore.

The exchange had 46 million active clients as of September 2026, representing just 3% of India’s population, highlighting the scope for further growth in market participation. The brokerage also pointed to the rising share of younger investors, with individuals below 30 years accounting for 38.4% of NSE’s individual investor base in FY26, compared with 22.6% in FY19.

Motilal Oswal believes this demographic shift could support higher trading activity and larger average ticket sizes as younger investors mature and increase their participation in the capital markets.

NSE’s dominant market position

NSE commanded a 93% share of the cash market, 99.8% of equity futures and 74.7% of equity options premium turnover in FY26, according to the brokerage.

Equity options account for approximately 75% of NSE’s transaction fee revenue, while cash market transactions contribute around 12% and equity futures approximately 11%.

The exchange also has a significant presence in global markets, accounting for around 12% of worldwide cash market trades. It ranks third globally by cash market trading volumes, behind the Shenzhen Stock Exchange (SZSE) and Shanghai Stock Exchange (SSE). NSE was also ranked fifth globally in terms of options contracts traded in Q1FY27.

High margins and technology capabilities

Motilal Oswal highlighted NSE’s strong profitability, with EBITDA margins consistently remaining above 70%. The brokerage believes the exchange’s largely fixed cost structure allows it to generate strong incremental margins as trading volumes recover.

It also highlighted the scale and resilience of NSE’s technology infrastructure, which handled a peak of 21.9 billion order messages and 201 million trades on March 24, 2026. The platform has the capacity to process around five million messages per second, with further investments expected to strengthen its technology capabilities.

Motilal Oswal’s financial estimates

The brokerage expects NSE’s revenue to increase from ₹16,600 crore in FY26 to ₹23,400 crore by FY29, translating into a compound annual growth rate (CAGR) of 12%.

EBITDA is projected to grow at a CAGR of 13% over FY26–FY29, with margins expected to expand to around 77% by FY29.

Net profit is expected to reach ₹15,000 crore by FY29, implying a CAGR of 13% over FY26–FY29. Return on equity (RoE) is also projected to improve from 30% in FY26 to 43% by FY29.