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Financial Technologies’ (FTIL’s) consolidated operating income slumped to a fourth in 2014-15 from 2012-13, when its spot commodities trading subsidiary National Spot Exchange Ltd (NSEL) shut shop.
This software service company could not declare consolidated results for the last two years after NSEL faced default by borrowers on its platform amounting to Rs 5,600 crore. The company’s legal and professional charges increased from Rs 22 crore in 2012-13 to Rs 102 crore in 2014-15.
FTIL could only now complete the audit of some of the group companies and posted a consolidated income from operations of Rs 191.12 crore for 2014-15 against Rs 735.08 crore in 2012-13.
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NSEL suspended trading amid default on July 31, 2013. In 2013-14, FTIL posted its income at Rs 557.29 crore.
FTIL’s income was affected by the halt in revenue from NSEL and a steep decline from its subsidiaries. Under pressure from regulators following the Forward Markets Commission (FMC) declaring FTIL not “fit and proper”, the company sold its stake in all subsidiaries. In August 2014, FTIL and MCX negotiated a 40 per cent cut in annual maintenance fees. The payment crisis at NSEL attracted litigation in the Company Law Board, Bombay High Court, Supreme Court, and the of MPID court.
