IEX Share Price Plummet
Shares of Indian Energy Exchange Ltd. hit an all-time low, dropping over 26% by 1:00 p.m. The decline came after the company was locked in a 10% lower circuit on Thursday. This sharp fall was a result of the Central Electricity Regulatory Commission’s approval of a phased rollout of market coupling across India’s power exchanges.
Impact of Market Coupling Approval
The approval by the Central Electricity Regulatory Commission marks a significant shift in price-setting responsibilities. It moves these duties from individual exchanges to a central body. This change poses a challenge for Indian Energy Exchange, which currently manages a large portion of trade volumes and plays a crucial role in price discovery.
Market Efficiency vs. Profitability
While the aim of the change is to enhance market efficiency, it also diminishes the commercial price discovery function of exchanges like IEX in price determination. Given that IEX generates most of its revenue from high-volume trading in the Day-Ahead Market and Real-Time Market segments, this shift could impact its market position and profitability.
Rise in PTC India Shares
Conversely, PTC India witnessed a nearly 5% surge, reaching an intraday high of Rs 207. The company is set to benefit from the recent developments in the market.
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