MCX-SX cash market turnover plunges 44% in November

MCX Stock Exchange witnessed a 44.2 per cent plunge in its cash segment turnover to Rs 624 crore (Rs 6.24 billion) in November -- one of its worst falls since a crisis broke out at another FTIL group-promoted firm NSEL earlier this year.

The cash segment turnover at MCX-SX sharply fell to Rs 624 crore (Rs 6.24 billion) in November from Rs 1,119 crore (Rs 11.19 billion) in October, 2013.

The turnover is one of the lowest registered by MCX-SX since the Rs 5,600 crore (Rs 56 billion) payment crisis hit National Spot Exchange Ltd in July.

MCX-SX's equity derivative turnover also plunged by 20 per cent to nearly Rs 8765 crore (Rs 87.65 billion) in November from Rs 10,968 crore (Rs 109.68 billion) in the previous month.

The total volume of derivative contracts on MCX-SX declined to 281,000 in November from 357,000 in October.

MCX-SX has seen a lot of changes in its leadership team in recent months.

A new Chairman has been appointed to its board and the process to appoint a new CEO is currently underway, while Sebi in September had ordered setting up of a panel to oversee key business functions and decisions of the exchange.

MCX-SX, which began functioning as a full fledged bourse in February, this year, had shown a strong growth earlier this fiscal in both its equity derivative and cash segments.

In the cash segment, the turnover had reached to over Rs 2,000 crore (Rs 20 billion) in May and close to Rs 3,000 crore (Rs 30 billion) figure in June from just Rs 33 crore (Rs 330 million) in April.

However, its cash turnover had began to fall in July although it had retained Rs 1,000-crore (Rs 10-billion) level till August before dipping to Rs 990 crore (Rs 9.9 billion) in September.

However, the bourse had shown signs of recovery by crossing the Rs 1,000-crore (Rs 10-billion) level mark in October.

In the equity derivative segment, the turnover had consistently gone up from Rs 6,607 crore (Rs 66.07 billion) in April to Rs 32,686 crore (Rs 326.86 billion) in July, but witnessed a dip in August and September.

The bourse' turnover stood at Rs 7,133 crore (Rs 71.33 billion) in September, 69 per cent lower than what was recorded in August before rising again in October.

MCX-SX was set up by Jignesh Shah-led Financial Technologies (India) Ltd, which also has a near 100 per cent stake in NSEL.

Market regulator Sebi has directed MCX-SX to strengthen its corporate governance structure in wake of the NSEL crisis.

Over the recent months, MCX-SX has witnessed a string of resignations, including that of Jignesh Shah and Joseph Massey from its board.

On November 1, former home secretary G K Pillai was appointed as MCX-SX's Chairman and former LIC chief Thomas Mathew T became the Vice-Chairman, following approvals by Sebi.

Multi Commodity Exchange (MCX) and Financial Technologies together hold 9.97 per cent shareholding in MCX-SX, as on the quarter ended September 30, 2013.