Mumbai/New Delhi: Multi Commodity Exchange (MCX), India’s largest commodity bourse, said on Monday that it has received approval from the Securities and Exchange Board of India (SEBI) to invest in the proposed National Coal Exchange of India. The approval, granted on April 17, will allow MCX to set up a new wholly owned subsidiary that is likely to be named MCX Coal Exchange Ltd or MCX Coal Exchange of India Ltd, according to a regulatory filing.
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MCX said it plans to commit capital of up to Rs 100 crore to the proposed subsidiary to meet the minimum net worth requirements under the draft Coal Exchange Rules. The exchange will initially own the new entity completely, with the option to induct strategic partners at a later stage.
The new company is expected to offer a transparent, standardised digital platform for the physical delivery of coal at market-driven prices. MCX said it will move to file an application with the Coal Controller Organisation (CCO) of India once the prescribed timelines are notified.
The move expands MCX’s existing presence in the energy derivatives space, where it already trades highly liquid crude oil and natural gas contracts. The exchange also launched an electricity futures contract last year, and the addition of coal is seen as filling out its coverage across the broader energy complex.
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The proposed coal exchange is intended to create a regulated, technology-driven marketplace for the fuel, which remains central to India’s power generation and industrial activity. The exchange aims to improve price discovery and make coal trading more efficient.
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