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No links, financial or otherwise, with NSEL: MCX chief

Last Updated: Monday, September 30, 2013 - 23:47

Mumbai: The Multi-Commodity Exchange (MCX) on Monday said it has no links, financial or otherwise, with the troubled National Spot Exchange Ltd (NSEL) which is facing payment crisis of Rs 5,600 crore.

"There is absolutely no linkages, financial or otherwise with NSEL, which is totally different Company," MCX's acting chairman R M Premkumar told reporters on the sidelines of the company's 11th annual general meeting here.

The shareholders were surprised by the absence of promoter Jignesh Shah at the AGM, which was a low-key affair. Some investors also staged protest but away from the venue of AGM as there was heavy police security.

Premkumar, nominated as acting chairman by regulator Foward Market Commission, said: "MCX's risk management is very much in place and evaluated by EY. We see no crisis as the exchange security systems are audited on continuous basis whether it is collateral or fixed deposits etc."

Commenting on recent fall in share price of MCX, Premkumar said the company has no plans to buy back the shares.

The share price fell sharply when NSEL crisis came to fore.

"The zero-debt MCX has strong fundamentals and has 87 percent market share. The share price has come down due to falling volume due to CTT levied in July this year and unfortunate public perception of any perceived linkage with NSEL," he said.

Meanwhile, the exchange is seeking the Reserve Bank's permission to hike foreign holding from 23 to 49 percent.

The FII/FDI cap in the sector is currently 49 percent. At present FIIs hold 23 percent in the exchange while foreign corporate bodies hold 10.5 percent, taking the overall foreign holding to 33.5 percent in the country's only listed commodities exchange.

First Published: Monday, September 30, 2013 - 19:32
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