Investment firm India Securities to pour ₹28 crore into National Commodity and Derivatives Exchange (NCDEX)
Indian equities are expected to open lower ahead of the US Fed policy meet, but one company is looking beyond the short-term market fluctuations. Share India Securities (SIS) has approved an investment of up to ₹28 crore in National Commodity & Derivatives Exchange Ltd (NCDEX), marking a strategic move to diversify and strengthen its presence in the financial services and securities market ecosystem.
The investment, which will be made by acquiring 14,18,871 equity shares at ₹197.34 a share, represents a 1.582% stake in NCDEX. This strategic move aims to leverage NCDEX’s technology-driven platform and pan-India reach to enhance SIS’s market positioning in securities and derivatives.
NCDEX, a nation-level, online Commodity Exchange with an independent Board of Directors and professional management, is expanding its product offerings towards equity and equity derivatives trading. This growth avenue complements SIS’s expertise in equity derivatives broking and related financial services. By investing in NCDEX, SIS gains strategic leverage to participate in and possibly influence this diversification, enhancing its presence in both commodity and equity markets.
The investment does not fall within the ambit of a related party transaction for SIS and none of the promoter, promoter group, or group companies of SIS have any interest in NCDEX. This move aligns with NCDEX’s plans to launch equity and equity derivatives trading, positioning SIS as an early investor and stakeholder in an evolving exchange ecosystem.
The board of NCDEX has approved a primary equity raise of ₹500-₹600 crore to finance platform build-out, compliance infrastructure, member onboarding, and product innovation. The acquisition is for investment purposes and is expected to be completed within 60 working days from the date of disclosure.
It's important to note that this investment does not affect the stock price of Share India Securities, which closed 0.39 per cent lower at ₹159.33 on the previous day. However, this strategic move could potentially position SIS for future growth opportunities in the commodity and equity markets.
In summary, Share India Securities’ investment supports its strategic intent to diversify and strengthen its role across multiple market segments, while aligning with NCDEX’s expansion from commodity derivatives into equity derivatives trading, reflecting mutual growth prospects within India’s financial and securities markets.
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