ICEX in search of MD

Indian Commodity Exchange (ICEX) intends to relaunch by appointing a managing director and chief executive officer. Said an exchange official, "We are in the process of formally inviting applications, the process for which would begin for building the entire team." The board of directors has set up a five-member selection committee.

ICEX also plans to float a rights issue for raising funds to meet the new minimum net worth criterion of Rs 100 crore, from its Rs 15-20 crore. "The first step would be to appoint a new MD & CEO," said the official.

According to informed sources, the board members hope to have a new team in place in a month or two.

Five years after its launch in 2009 by Indiabulls Financial Services and MMTC, the exchange had suspended futures trading in commodities, due to weak financial performance. Reliance ADAG Group company Reliance Exchange Next, a wholly owned subsidiary of Reliance Capital, entered through the purchase of 26 per cent stake from Indiabulls in January 2011.

Last week, Anil Ambani, the Reliance ADAG chairman, had told shareholders of Reliance Capital, "(We) are now in advanced preparations (to) relaunch ICEX and expect to grow the business in a significant manner, so as to attain the leadership ranking in three years."

Sources said, if all goes well the exchange would start offering futures trade as early as December. ICEX plans to hire its MD & CEO either from the stock exchanges or commodity markets. What is envisaged is 10-15 years of experience and mot more than 50 years of age. Age and experience, however, couldy be relaxed for a suitable candidate.

Ambani had said there was huge potential for growth in commodity futures trading. "Precious and industrial metals hold enormous potential. Daily average commodity volumes in India are a meagre 0.2 per cent of the gross domestic product, as compared to the Chicago Mercantile Exchange which enjoys 26 per cent of volume of the United States GDP, which constitutes Rs 290 lakh crore."

In India, all exchanges cumulatively clocked a turnover of nearly Rs 60 lakh crore in 2014-15, a 40 per cent decline from Rs 101 lakh crore the previous year.