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Multi Commodity Exchange of India Ltd. (MCX) has informed the exchanges that market regulator SEBI has advised the company and MCXCCL to furnish detailed comments on the issues pertaining to the Chennai Financial Markets and Accountability (CFMA) by October 3.
The company said that it will submit detailed documents before the SEBI’s Technical Advisory Committee meeting.
Earlier in the day, shares of MCX fell over 8 percent, giving up all the gains it made on Thursday, after the Securities and Exchange Board of India has asked Multi Commodity Exchange of India Ltd. (MCX) to keep the proposed Go-Live of its new Commodity Derivatives Platform “in abeyance.”
In abeyance means a state of temporary disuse or suspension.
The company in an exchange filing stated that the market regulator forwarded a copy of a letter from Chennai Financial Markets and Accountability (CFMA) regarding the new platform. It mentioned that the CFMA has filed write petitions with regards to the CDP, which is pending disposal before the Madras High Court.
SEBI also stated that since the matter involves technical issues, the same will be discussed in the SEBI technical advisory committee meeting, which will be held shortly. However, no dates have been specified for the same.
MCX mentioned in the exchange filing that it will continue to conduct mock tests for the new Commodity Derivatives Platform until further directions from SEBI.
In preparation for this transition, MCX’s Clearing Corporation has scheduled a mock session on October 2. This session is designed to facilitate member engagement and familiarisation with the new platform. MCX’s decision to shift to this platform follows two prior unsuccessful attempts, leading to the renewal of agreements.
“First a disclosure that we have investments in MCX. And I think amongst the entire exchange space, MCX perhaps has the best dynamics in terms of risk return. The more important story in MCX is the growth of options trading and earlier, I think options was eating into the value of the futures trading but now I think futures volume has stabilized,” Dipan Mehta of Elixir Equities said.
“I think the profits over the next two, three quarters can jump many fold because of these developments. So very positive and MCX and I think the price rise, which we have seen, seems to be fully justified,” he added.
Shares of MCX have recovered nearly 6 percent from the lowest point of the day. The stock is now 3 percent lower at Rs 2,032.95.
(Edited by : Hormaz Fatakia)
First Published: Sept 29, 2023 8:09 AM IST
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