 "Commodity brokerage space witnesses consolidation")
To get around the stringent regulations under the Securities and Exchange Board of India (Sebi), nearly half of the commodity exchange members have stayed away from fresh registration with the markets regulator. This indicates consolidation in commodity brokerage space.
Data compiled by the three national commodity exchanges - Multi Commodity Exchange of India (MCX), National Commodity & Derivatives Exchange (NCDEX), and National Multi Commodity Exchange (NMCE) - showed a total of 1,208 members sought registration. However, only 42 per cent registered with the erstwhile regulator the Forward Markets Commission (FMC) before its merger with Sebi.
"Since a number of members opted out, consolidation is automatic as their clients would shift to other members for trading on commodity exchanges," said Jayant Manglik, president (retail distribution), Religare Securities.
Only 42 per cent or 710 members have applied for registration out of 1,700 members of MCX. This means the remaining 58 per cent would either shift to other business or continue trading on commodity exchanges as clients.
On NCDEX, however, 64 per cent of its 700 members opted for Sebi registration. Ahmedabad based NMCE was the least performer in terms of registration - 12 per cent.
"Members might be looking forward to consolidating their business, which may have an impact on commodity futures business," said Naveen Mathur, associate director (commodities and currencies), Angel Broking.
Meanwhile, traders anticipate three types of scenario emerging for fewer members opting for Sebi registration.
Data compiled by the three national commodity exchanges - Multi Commodity Exchange of India (MCX), National Commodity & Derivatives Exchange (NCDEX), and National Multi Commodity Exchange (NMCE) - showed a total of 1,208 members sought registration. However, only 42 per cent registered with the erstwhile regulator the Forward Markets Commission (FMC) before its merger with Sebi.
"Since a number of members opted out, consolidation is automatic as their clients would shift to other members for trading on commodity exchanges," said Jayant Manglik, president (retail distribution), Religare Securities.
Only 42 per cent or 710 members have applied for registration out of 1,700 members of MCX. This means the remaining 58 per cent would either shift to other business or continue trading on commodity exchanges as clients.
On NCDEX, however, 64 per cent of its 700 members opted for Sebi registration. Ahmedabad based NMCE was the least performer in terms of registration - 12 per cent.
"Members might be looking forward to consolidating their business, which may have an impact on commodity futures business," said Naveen Mathur, associate director (commodities and currencies), Angel Broking.
Meanwhile, traders anticipate three types of scenario emerging for fewer members opting for Sebi registration.