The National Stock Exchange has decided to remove IRCTC Ltd. from the F&O segment, effective 25 February 2026, in what is seen as a significant shift for one of the most popular public-sector stock in India’s derivatives market.
The removal of Indian Railway Catering and Tourism Corp. Ltd., or IRCTC, from the F&O stocks list is not a ban but a permanent exclusion from derivatives trading. Here’s what it means for the investor and the stock:
1. No new contracts: After the 25 February 2026 expiry, no new monthly or quarterly F&O contracts will be introduced for IRCTC. The existing contracts—March 2026 onwards—will be phased out. Traders will not be able to initiate fresh long and short positions in the derivatives segment.
2. Shift to cash market: Once IRCTC exits the F&O stocks list, trading will be restricted solely to the “cash” or “equity” segment. This means investors can only buy or sell the actual shares of IRCTC. The ability to trade with “leverage” —where you control a large value of shares with a small margin—will disappear for this stock.
3. Reduced volatility and liquidity: F&O stocks often experience high trading volumes and sharp price swings due to speculative activity. With the derivatives exit, speculative “noise” reduces, leading to more stable price movement. But it may also lead to a drop in overall trading liquidity, as high-frequency traders move to other F&O stocks.
4. Impact on hedging: Institutional investors who hold large quantities of IRCTC stock will no longer be able to use “Put options” or “Futures” to protect their portfolio against sudden price drops in the stock.
What is F&O trading?
It’s worth explaing here what F&O actually means.
F&O stands for futures & options. These are “derivative” contracts, meaning their value is derived from an underlying asset—in this case, IRCTC shares.
Futures: A contract where you agree to buy or sell a stock at a pre-set price on a specific future date. It allows you to bet on whether a stock will go up/down.
Options: These give you the right—but not the obligation—to buy or sell a stock at a specific price. They are often used like “insurance” to protect against loss or to make quick gains with limited capital.
In short, F&O allows traders to trade quantities using only a fraction of the total money (leverage), making it a high-risk, high-reward segment compared to simply buying shares in the cash market.