The Ltd. is winning bullish backing from brokers, as they expect the bourse’s dominance to gain in India’s deepening capital markets.




and Chase & Co. have initiated coverage of ’s stock with overweight ratings, even as it has mostly traded below its initial public offering price since listing in September. India’s Markets Pvt. also recommends buying the stock.




The optimism reflects confidence in the structural expansion of India’s capital markets despite near-term concerns over slowing derivatives growth. A widening investor base in the world’s most populous nation and rising trading activity could benefit its top exchange regardless of market direction.




Morgan Stanley is the most bullish with a 2,315-rupee price target for 12 months, implying an upside of as much as 30% from Friday’s closing price. JPMorgan sees the shares reaching 2,130 rupees, while 360 ONE has a 2,100-rupee target. Affiliates of the three firms were among the banks that worked on NSE’s .




also has a buy recommendation on NSE, while Macquarie Capital rated it outperform.



NSE is an “engine of India’s capital markets,” Morgan Stanley said, terming the exchange a strong play on financialization of household savings and a shift toward equities. India’s markets remain underpenetrated, with just 3.2% of working-age Indians trading in NSE’s cash market and 0.7% trading equity derivatives, it said.




The brokerage expects NSE’s dominant position and asset-light business model to support premium valuations. NSE has more than 90% share in the cash-equities market and nearly all of equity futures and single-stock options, while its index-options share appears to have stabilized at about 65%, it said.




New businesses, including commodities, a mutual-fund ordering platform and electronic gold receipts, could reduce NSE’s reliance on equity options and add about 15% to revenue and profit by fiscal 2030, according to Jefferies.




“A recovery in capital market conditions, coupled with the potential upside from smaller revenue streams, could further aid ,” Swarnabha Mukherjee, an analyst at 360 ONE, wrote in a note.