MTF Growth Moderates While ADTO Rises in January 2026: CareEdge

The Margin Trading Facility (MTF) book expanded to Rs 1.20 lakh crore in January 2026, reflecting continued investor participation despite moderation in growth. At the same time, Average Daily Turnover (ADTO) increased sharply, indicating a recovery in trading activity across segments. These trends were reported in CareEdge Ratings’ BFSI Research update dated February 09, 2026.

The Margin Trading Facility (MTF) book increased from Rs 0.84 lakh crore in January 2025 to Rs 1.20 lakh crore in January 2026, recording year-on-year growth of 42.9% compared with 38.0% in December 2025. Although this was lower than the 51.4% growth observed in January 2025, it indicated continued use of margin funding during uneven market conditions. On a sequential basis, the MTF book rose in January 2026 compared with December 2025.

The National Stock Exchange (NSE) continued to account for nearly 97% of total MTF financing. The average MTF book on NSE increased from Rs 0.80 lakh crore in January 2025 to Rs 1.16 lakh crore in January 2026, representing a 44.7% year-on-year rise, while the sequential increase was Rs 0.03 lakh crore. The Bombay Stock Exchange (BSE) maintained a smaller share of MTF volumes and recorded a 2.3% year-on-year increase in January 2026, with month-on-month levels remaining largely stable. Sequentially, overall MTF growth improved to 3.0% in January 2026, reversing the 0.6% decline seen in January 2025.

Average Daily Turnover (ADTO) across futures and options and equity segments rose by 98.2% year-on-year to Rs 593.6 lakh crore in January 2026. The increase reflected a low base in January 2025 following regulatory tightening and a recovery in trading activity. Sequentially, ADTO rose by Rs 120.5 lakh crore from Rs 473.1 lakh crore in December 2025, when volumes were lower due to the holiday period. Trading activity increased in January as investors returned to the market and carried forward positions into the new year.

Cash market turnover also showed improvement, with ADTO rising 26.3% year-on-year to Rs 1.29 lakh crore, compared with a contraction of 17.2% a year earlier. On a sequential basis, cash market turnover increased by Rs 0.27 lakh crore, indicating higher equity participation.

The Union Budget 2026–27 proposed an increase in Securities Transaction Tax (STT) across the futures and options segment. STT on futures transactions is proposed to rise to 0.05% from 0.02%. In addition, STT on option premiums and option exercise is proposed to increase to 0.15% from 0.10% and 0.125%, respectively. This change is expected to moderate futures and options volumes and may affect broker revenues, particularly for discount brokers with higher exposure to this segment.

According to CareEdge Ratings, the MTF segment recorded year-on-year growth of 42.9% in January 2026, with the average MTF book reaching Rs 1.20 lakh crore. Sequential growth was supported by improved market sentiment and continued liquidity support from NSE and BSE. The data indicated gradual normalisation in market activity as participants adjusted to earlier regulatory measures, while retail participation remained stable. ADTO strengthened both on a year-on-year and sequential basis, driven mainly by the futures and options segment, reflecting improved liquidity conditions and renewed investor participation.