Article By Umesh Paliwal, Co-founder, UnlistedZone
The Metropolitan Stock Exchange of India (MSEI), once considered a dormant entity in India’s capital market ecosystem, is suddenly back in the spotlight — not once, but twice in the span of six months.
Let’s decode what’s happening and whether this revival is real or a speculative bubble waiting to burst.
In December 2024, MSEI successfully raised ₹240 crore through private placement. Just a few months later, in July 2025, the exchange announced its intent to raise an additional ₹1,000 crore.
Together, this brings their total funding ambition to a whopping ₹1,240 crore in less than six months.
This sudden fundraising spree has naturally caught the attention of market participants. But the real question is — why is there so much renewed interest in MSEI?
For nearly seven years, MSEI’s unlisted shares traded between ₹0.80 and ₹2 — with negligible volumes and no investor attention.
But in late 2024 and early 2025, the stock price soared to ₹12, backed by a wave of optimism around MSEI potentially launching a new F&O platform, giving India a third expiry window in the week.
Between 2020 and 2024, India saw explosive growth in F&O trading volumes, especially from retail investors. This raised alarms at SEBI.
Their internal study revealed that retail investors had lost over ₹1 lakh crore in derivatives trading — a staggering amount. And much of this capital was being extracted by foreign hedge funds, like in the case of Jane Street, operating in Indian markets.
To curb this, SEBI mandated that a single weekly expiry could be allowed per exchange, drastically reducing the arbitrage and intraday churn previously enabled by multiple expiries across NSE and BSE.
This hit revenues for both exchanges and brokers, who then began exploring alternatives. That’s when MSEI entered the picture, positioning itself as a platform for an additional weekly expiry, potentially on Friday.
This narrative gave investors hope and triggered a sharp price rally.
However, in April–May 2025, SEBI made it clear: Only two days exchanges can host weekly expiries:
Tuesday to NSE
Thursday to BSE
MSEI had chosen Tuesday for its expiry — which was already taken by NSE. This effectively nullified the most promising revenue channel MSEI was counting on.
As a result, its entire F&O strategy was rendered void.
With its F&O ambitions blocked, MSEI is now exploring alternative revenue models such as:
Launching cash market products
Entering the bond exchange space
Focusing on niche trading products or regulatory services
However, these segments are highly competitive and already dominated by established players. Whether MSEI can gain meaningful market share here remains uncertain.
As the optimism faded, MSEI’s share price began to correct from its recent highs. The market is clearly reacting to the regulatory setback and the lack of clear monetization pathways ahead.
Adding to that, the proposed ₹1,000 crore fundraising could lead to significant dilution, especially if not backed by visible growth plans.
At UnlistedZone, our view is cautious:
MSEI’s revival story is not backed by operational traction yet.
Its entire valuation spike was driven by sentiment and hope around F&O.
With SEBI closing that door, the company is now in search mode for new revenue streams.
If — and that’s a big if — MSEI is able to launch meaningful products in the cash or bond segment and start generating revenue, interest could return.
Until then, investors should view MSEI as a high-risk, speculative bet — one that currently lacks clarity on fundamentals but still has room for optionality.
www.unlistedzone.com
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