The National Stock Exchange of India (NSE) has announced that the exclusion of futures and options (F&O) contracts for four specific securities will be effective from the January 2026 expiry. In this article, let’s take a look at the four stocks that will be removed from the NSE F&O segment starting January 2026.
In a circular dated October 24, the exchange stated that no new F&O contracts will be launched for these stocks after the current contracts expire. This decision aligns with SEBI’s circular dated August 30, 2024, which outlines the eligibility criteria for stocks in derivative trading.
The NSE clarified that existing contracts for the October 2025, November 2025, and December 2025 expiry months will remain tradable until their respective expiry dates. New strike prices will also be added for these ongoing contract months. After the December 2025 contracts expire, F&O trading in these four securities will no longer be available.
Demerits for stock on Exclusion
When a stock is excluded from the F&O segment, here are the demerits of the exclusion
- Reduced Liquidity: F&O contracts typically enhance liquidity in a stock. Exclusion can lead to decreased trading volumes, making it harder for investors to buy or sell the stock easily.
- Lower Market Interest: Without the ability to trade F&O contracts, the stock may attract less attention from institutional investors and traders who use these contracts for hedging or speculation.
- Price Volatility: The absence of F&O trading can lead to higher price volatility, as the stock may face less market depth and fewer players engaging in trades.
Limited Hedging Options: Investors and traders may lose the ability to hedge their positions using F&O contracts, which could result in greater risk exposure.
Impact on Stock Performance: F&O exclusion can lead to a reduction in overall investor confidence, potentially causing a dip in the stock’s performance.
Here is the List of stocks to watch out for:
Cyient Ltd
Cyient Ltd. is a global technology company that provides engineering and technology solutions through its “Intelligent Engineering” approach, which combines advanced technologies like AI, data analytics, and 5G to design, build, and maintain products, plants, and networks. It serves over 300 customers across various industries, including aerospace, automotive, and healthcare, with a focus on creating a sustainable and digitally connected future.
HFCL Ltd
HFCL Ltd is an Indian company that designs, develops, and manufactures telecommunications and networking products, as well as defence equipment. It is a major provider of optical fiber cables (OFC) and other telecom infrastructure solutions for clients in the telecommunications, defense, and government sectors. The company has a network of manufacturing facilities across India, and its business includes designing digital networks, manufacturing high-end telecom and defense equipment, and providing system integration and project management services.
NCC Ltd
NCC Ltd, formerly Nagarjuna Construction Company Ltd, is an Indian construction and infrastructure company founded in 1978, with its headquarters in Hyderabad. The company operates in various sectors, including buildings, transportation, water and environment, irrigation, electrical (T&D), railways, and mining. NCC Ltd focuses on delivering projects on time and with high-quality standards, and its operations have expanded to have a pan-India presence.
Titagarh Rail Systems Ltd
Titagarh Rail Systems Ltd (TRSL) is one of the leading Indian manufacturers of railway rolling stock and is India’s largest private company in this sector. The company manufactures both freight wagons and passenger coaches for national railways and metro systems, and also produces propulsion systems, steel castings, and specialized equipment.
TRSL plays a key role in national infrastructure projects, including the production of Vande Bharat trains and metro coaches, aligning with the “Make in India” and “Atmanirbhar Bharat” initiatives.
Merits for stock on Exclusion
When a stock is excluded from the F&O segment, it can bring some benefits. The reduced speculative and derivatives-based trading helps stabilize prices and lowers the risk of manipulation. This shift encourages a focus on the company’s fundamentals, attracting more long-term investors. Volatility may decrease, leading to more natural price discovery. Additionally, retail investors often feel more confident entering such stocks, boosting broader market participation.
Written by Sridhar J
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