MCX obtains FMC nod for IPO

The country’s largest commodities futures trading platform, Multi Commodity Exchange (MCX), has obtained mandatory approval for its proposed initial public offer (IPO) from the market regulator, Forward Markets Commission (FMC). FMC in its latest fortnightly commodity report said that the regulator had granted approval to the MCX for the latter’s proposed IPO. This is the third such approval the exchange has received from the FMC.

On the previous two occasions, however, the exchange’s promoter, Financial Technologies (FTIL) postponed plan to enter into the capital market due to poor investors’ sentiment.

Meanwhile, FTIL has not yet filed draft red herring prospectus (DRHP) with the capital markets regulator, Securities and Exchange Board of India (Sebi), which is mandatory for any company to enter into capital market for raising fund. Two DRHP filed with Sebi earlier, lapsed.

“We are working on various options including strategic sales and IPO to meet the regulatory guidelines. No final decision has been taken in this regard,” said the company spokesperson.

According to Forward Contracts (Regulation) Act, no investor should hold more than 26 per cent of equity in commodity exchange. But, FTIL currently holds 31 per cent in MCX which it will have to bring down to 26 per cent by September 30.