Re: {LONGTERMINVESTORS} MCX - Discussion Thread
Rajesh Desai
At 09:45 a.m.; MCX was trading 3.1 per cent higher at Rs 908. It hit a high of Rs 913.75 and a low of Rs 886 in trade today.
The debt segment was launched by MCX-SX on Friday when its equity segment daily turnover crossed Rs 1,000 crore milestone, while turnover of its flagship stock index 'SX40' crossed Rs 500 crore mark.
MCX-SX's debt segment will go live on Monday, would facilitate trading and settlement in all debt securities on a single platform, in line with the mechanism in place globally in the fixed income markets.
"The exchange received permission from Sebi to deal in equity and equity futures & options,interest rate futures and wholesale debt segments in July 2012," PTI said in a report.
"Consequently, it conducted a membership drive in September-October 2012 and finalised the necessary infrastructure, systems and procedures to begin trading," added the report
The Multi Commodity Exchange (MCX), India’s largest commodity derivatives trading platform, has increased its market share by five percentage points in the first two months of the current financial year due to aggressive traders’ participation in non-agri space on higher volatility.
The market share of MCX shot up to 90.11% with a record turnover of Rs 2545427.94 crore in the period between April – May 2013 as compared to Rs 2313925.76 crore in the corresponding period last year. During the period under consideration, however, the exchange recorded a 10% growth in its overall turnover as traders’ hedged their position to protect themselves from extremely volatile non-agri commodity prices.
“Extreme volatility in non-agri commodities space was the major contributor for a rise in the MCX turnover. At the same time, prices of agri commodities remained subdued resulting into lower business in other exchanges,” said Naveen Mathur, Associate Director, Angel Broking.
The gain in the turnover of MCX was a relative loss in business for other exchanges. While the agri centric leading commodity exchange National Commodity & Derivatives Exchange (NCDEX) witnessed a sharp fall in its market share during the first two months of the current financial year. From the level of 10.41% of NCDEX contribution to the overall commodity futures turnover of Rs 2707900.79 crore in the April – May 2012 period, the market share of the exchange declined to 6.86% in the same period a year later. Overall business of all commodity exchanges accumulatively was recorded at Rs 2824658.79 crore in the two months period between April – May 2013.
NCDEX recorded an overall turnover of Rs 193651.66 crore in the first two months of the current financial year as compared to Rs 281917.40 crore in the comparable period last year.
With the monsoon sets in time in India, the volatility in agri commodities is likely to remain high in coming months which would drive NCDEX’s business in near term, said Mathur.
Kishore Narne, Associate Director, Motilal Oswal, said, “A year back, a few commodities including guar, and pepper used to contribute significantly to NCDEX turnover. Despite re-listing of guar turnover continues to remain lower in this segment. Also, pepper yet to see the light of the day on national exchanges. Also most of agri commodity prices have severely declined in the last one year. Being the market share a component of turnover and open interest, the latter is gradually replenishing in the ongoing kharif season. Hence, the market share of other exchanges down.”
Meanwhile, market share of other exchanges also fell in April – May period. From the level of 2.01% with a turnover of Rs 54373.26 crore, the Ahmedabad – headquartered National Multi Commodity Exchange (NMCE) witnessed a sharp fall in its overall contribution to commodity futures business to 1.76% at an accumulative turnover of Rs 49610.74 crore in the same period this year.
Reliance ADAG Group controlled Indian Commodity Exchange (ICEX) also witnessed a fall in its market share from 1.27% (Rs 34372.34 crore) in April – May 2012 to Rs 0.83% (Rs 23529.99 crore) in the corresponding period this year.
Commodity exchanges turnover (Rs crore) Exchange April - May'12 April - May'13 NCDEX 281,917.40 193,651.66 % of total 10.41 6.86 MCX 2,313,925.76 2,545,427.94 % of total 85.45 90.11 NMCE 54,373.26 49,610.74 % of total 2.01 1.76 ICEX 34,372.34 23,529.99 % of total 1.27 0.83 ACE 23,312.03 12,438.46 % of total 0.86 0.44 Total 2,707,900.79 2,824,658.79
With a staggering 47% decline in turnover, the market share of Kotak anchored Ace Derivatives & Commodity Exchange (Ace) fell from 0.86% to 0.44% in the first two months of the current financial year.
Between April – May 2013, the turnover of Ace fell to Rs 12438.46 crore from the level of Rs 23312.03 crore in the corresponding period last year.
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CA Mihir Desai
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CA. Rajesh Desai