BSE earnings hold despite STT hike; EMS gains from Budget, says Mayuresh Joshi

Mayuresh Joshi, Director-Research at Marketsmith India, said BSE’s recent performance has been supported by revenue expansion and transaction growth.

He said, “In fact, it's the highest quarterly revenue that has got recorded. I think in terms of the margin performance; the transaction revenues have seen an increase over a nine-month period.”

Joshi noted that the Securities Transaction Tax (STT) increase may impact trading activity in the near term but expects transaction revenue growth to continue due to client additions and member expansion. He said, “Even if valuations are on the higher side as a theme, it might continue doing well… the momentum can very well continue.”

On the electronics manufacturing services (EMS) sector, Joshi said government Budget allocation is expected to support order inflows across companies including Amber Enterprises and Dixon Technologies. He said, “The tailwind that acts for EMS as a space in general is the higher allocation in terms of the ₹40,000 crore that have been earmarked in the Budget.”

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He also highlighted a shift toward Original Design Manufacturer (ODM)-led business models, which could support margin expansion in the coming years.

Joshi said the sector is seeing client additions across product categories and order visibility remains strong. However, he noted that valuations across EMS companies remain above historical averages, making them suitable mainly for investors focused on growth trends rather than value metrics.

Against the backdrop of the evolving US trade arrangements with both India and Bangladesh, competition in global textile exports is expected to remain high, particularly across apparel and home textile categories.

Joshi said, “You will see a sentimental profit booking and Bangladesh has always been competitive."

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Joshi said companies with integrated operations across the textile value chain, from yarn to finished fabric, are expected to see relatively lower impact compared to non-integrated peers. According to him, “The integrated players who have probably got the entire value chain with them, right from yarn till fabric, it might feel the pinch a little lesser.”

He said integrated players such as KPR Mill and Vardhman Textiles may be relatively better placed. He also noted that Indo Count Industries is expanding capacity and setting up a pillow manufacturing facility in the US, which could help reduce tariff impact and competitive pressure over time.

For the full interview, watch the accompanying video

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