Sebi clears MCX plan to set up coal exchange with ₹100 crore investment

MCX to launch coal exchange subsidiary with full ownership initially, aiming to build a transparent and technology-driven market platform for coal trading in India

The Securities and Exchange Board of India (Sebi) has given the nod to Multi Commodity Exchange (MCX) to invest in a proposed coal exchange company. MCX plans to incorporate a new subsidiary, which is likely to be named MCX Coal Exchange.

 

“The foray into coal via the new entity will make MCX’s energy presence comprehensive. It is aimed at developing a regulated, transparent, technology-driven market platform for buying and selling coal that facilitates efficient and robust price discovery for coal in the country,” the exchange said in a statement.

 

MCX will initially hold a 100 per cent stake in the subsidiary, with the possibility of strategic partners in the future. MCX has made a capital commitment of up to Rs 100 crore to comply with the minimum net worth requirements as per draft Coal Exchange Rules.

 

 

The newly incorporated company will submit an application to the Coal Controller Organisation of India as and when prescribed, MCX added.

 

Earlier, the National Stock Exchange (NSE) received approval from the Ministry of Corporate Affairs (MCA) reserving the name National Coal Exchange. It has also received approval from Sebi for investments in the coal exchange.

 

NSE has committed an initial capital infusion of up to Rs 100 crore and will hold a 60 per cent stake in the entity, while the remaining 40 per cent will be offered to other stakeholders.

 

As per sources, the exchange is in talks with nearly half a dozen institutions that may partner for the coal exchange.