Q1 2027 Multi Commodity Exchange of India Ltd Earnings Call

Speaker #1: Ladies and gentlemen, the conference will begin shortly. Please stay connected. Thank you. Ladies and gentlemen, good day and welcome to the Multi Commodity Exchange of India Limited Q1 FY27 earnings conference call.

Operator 2: Ladies and gentlemen, the conference will begin shortly. Please stay connected. Thank you. Ladies and gentlemen, good day and welcome to the Multi Commodity Exchange of India Limited Q1 FY27 earnings conference call. Joining us on the call are Ms. Praveena Rai, Managing Director and CEO. Mr. Manoj Jain, Executive Director, Regulatory Compliance, Risk Management, and Investor Grievances. Mr. Sanjay Rajpal, Executive Director, Critical Operations. Mr. Chandresh Shah, Chief Financial Officer. Mr. Praveen DG, Chief Risk Officer. Mr. Shivanshu Mehta, Head of Department, Bullion and Interim Charge of CBO Portfolio. As a reminder, all participant lines will be in the listen only mode, and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing star then zero on your touchtone phone. Please note that this conference is being recorded.

Speaker #1: Joining us on the call are Ms. Praveena Rai, Managing Director and CEO; Mr. Manoj Jain, Executive Director, Regulatory, Compliance, Risk Management, and Investor Grievances; Mr. Sanjay Rajpal, Executive Director, Critical Operations; Mr. Chandra Shah, Chief Financial Officer; Mr. Praveen Diji, Chief Risk Officer; and Mr. Shivanshu Mehta, Head of Department, Bullion, and Interim Charge of CBO Portfolio. As a reminder, all participant lines will be in listen-only mode, and there will be an opportunity for you to ask questions after the presentation concludes.

Speaker #1: Should you need assistance during the conference call, please signal an operator by pressing star, then zero, on your touch-tone phone. Please note that this conference is being recorded.

Speaker #1: I now hand the conference over to Ms. Praveena Rai, MD and CEO of MCX. Thank you, and over to you, ma'am.

Operator 2: I now hand the conference over to Ms. Praveena Rai, MD and CEO, MCX. Thank you. Over to you, ma'am.

Speaker #2: Good evening, everybody. A warm welcome to all our shareholders, investors, analysts, and other stakeholders to this earnings conference call for the first quarter of FY27.

Praveena Rai: Good evening, everybody. A warm welcome to all our shareholders, investors, analysts, and other stakeholders to this earnings conference call for Q1 FY27. We are pleased to begin FY27 with another quarter of strong operational and financial performance, reinforcing the structural growth in India's commodity derivatives market and the resilience of our business model. Q1 followed an exceptionally strong Q4 FY26. There has been a consolidation performance in Q1. Performance continues to reflect healthy year-on-year growth across all key financial parameters. I'll summarize a few. During the quarter, our total income increased 85% to INR 752 crores, and revenue from operations grew to INR 702 crores, which is an 88% growth. EBITDA doubled to INR 544 crores, and there is a good EBITDA margin of 72%, with a PAT at INR 413 crores. This demonstrates the scalability of our business model and continued focus on efficiency.

Speaker #2: We are pleased to begin FY27 with another quarter of strong operational and financial performance, reinforcing the structural growth in India's commodity derivatives market and the resilience of our business models.

Speaker #2: Q1 followed an exceptionally strong fourth quarter of FY26. There has been a consolidation in performance in Q1. Performance continues to reflect healthy year-on-year growth across all key financial parameters.

Speaker #2: I'll summarize a few. So during the quarter, our total income increased 85% to ₹752 crore, and revenue from operations grew to ₹702 crore, which is an 88% growth.

Speaker #2: EBITDA doubled to ₹544 crore, and there is a strong EBITDA margin of 72%, with PAT at ₹413 crore. This demonstrates the scalability of our business model and our continued focus on efficiency.

Speaker #2: Underlying to this is strong fundamentals. The quarter witnessed very strong growth across the average daily turnover, the ADT, this grew by 10. this grew to 10.5 lakh crores this is a growth of 47% year-on-year and it's also a growth over last quarter.

Praveena Rai: Underlying to this is strong fundamentals. The quarter witnessed very strong growth across the average daily turnover, the ADT. This grew to INR 10.5 lakh crores. This is a growth of 47% year-on-year, and it's also a growth over last quarter. The notional options ADT has also grown by 266%. This reflects increased market depth, deeper liquidity, and wider adoption of commodity derivatives by market participants. Client participation is encouraging. Our traded client base doubles from previous year to 13.72 lakh clients this quarter. This really highlights the increasing acceptance of commodity derivatives as an effective tool for both hedging as well as investments. Beyond financial performance, we continue to strengthen our product portfolio. We've had a whopper of a contract. We've had a very successful launch of the Silver 100 futures contract. This was a demand from the market given the price of silver.

Speaker #2: The notional options ADT has also grown by 266%. So this reflects increased market depth, deeper liquidity, and wider adoption of commodity derivatives by market participants.

Speaker #2: Client participation is encouraging. Our traded client base doubled from the previous year to 13.72 lakh clients this quarter. This really highlights the increasing acceptance of commodity derivatives as an effective tool for both hedging as well as investments.

Speaker #2: Beyond financial performance, we continue to strengthen our product portfolio. We've had a whopper of a contract, we've had a very successful launch of the silver 100 gram futures contract, this was a demand from the market given the price of silver.

Speaker #2: In a quick response to market demand, the product was launched and has already seen very good performance, which we will talk about subsequently. This has become a more accessible hedging, as well as investment product, for the participants.

Praveena Rai: In a quick response to market demand, the product was launched and has already seen a very good performance, which we will talk about subsequently. This has become a more accessible hedging as well as investment product for the participants. MCX price is another piece I would like to highlight, that towards the end of last quarter, we had a regulatory directive by which exchange discovered price was to be used by the AMCs for AUM calculations. We have worked very closely with the industry and have a number of AMCs. At least 15 plus AMCs who are today using MCX bullion price as a reference for AUM calculations. A big action as far as the last quarter goes, is really expansion of good delivery norms.

Speaker #2: MCX price is another piece I would like to highlight. Towards the end of last quarter, we had a regulatory directive by which the exchange-discovered price was to be used by the AMCs for AUM calculations.

Speaker #2: We have worked very closely with the industry and have a number of AMCs. At least 15-plus AMCs are today using the MCX bullion price as a reference for AUM calculations.

Speaker #2: A big action, as far as the last quarter goes, is really the expansion of good delivery norms. In line with a lot of policy narratives around the country on bullion, we've included silver and also empaneled the country's first domestic silver refiner.

Praveena Rai: In line with a lot of policy narratives around the country on bullion, we've included silver and also empaneled the country's first domestic silver refiner. These norms align with best-in-class global standards, at par with all global norms that have so far been followed in the country. Three more domestic gold refiners have also been empaneled, and the gold delivery framework has also been extended across all contracts. These initiatives support the broader vision of promoting domestic refining and contributing to India's self-reliance in precious metals. It has been a step that has been much welcomed by the industry as well. Another industry milestone is we are at the very early stage of work on our coal exchange. On approval from the regulator, we have incorporated the MCX Coal Exchange of India Ltd., and other procedural items are in play towards the next steps on this.

Speaker #2: These norms align with best-in-class global standards, at par with all global norms that have so far been followed in the country. Three more domestic gold refiners have also been empaneled.

Speaker #2: And the gold delivery framework has also been extended across all contracts. So, these initiatives support the broader vision of promoting domestic refining and contributing to India's self-reliance in precious metals.

Speaker #2: It has been a step that has been much welcomed by the industry as well. Another industry milestone is that we are at the very early stage of work on our coal exchange.

Speaker #2: On approval from the regulator, we have incorporated the MCX Coal Exchange of India, and other procedural items are in play towards the next steps on this.

Speaker #2: This will create a transparent, efficient, technology-driven national coal trading ecosystem aligned with the government's market reforms as well as our long-term strategy of expanding into new commodity segments.

Praveena Rai: This will create a transparent, efficient, technology-driven national coal trading ecosystem aligned with the government's market reforms, as well as our long-term strategy of expanding into new commodity segments. On the global stage, MCX continues to strengthen its leadership position as per FIA 2025 statistics. MCX is the world's largest commodity options exchange and fourth largest commodity derivatives exchange by number of contracts traded. This reflects confidence reposed in our markets by participants and reinforces commitment to innovation, market development, and operational excellence. Looking forward, our focus remains on expanding participation, expanding our product suite, deepening liquidity across contracts, enhancing technology and market infrastructure, creating sustainable long-term value to all shareholders. With this, I would also like to highlight a very, very strong focus for MCX on risk management.

Speaker #2: On the global stage, MCX continues to strengthen its leadership position. As per FIA 2025 statistics, MCX is the world's largest commodity options exchange and the fourth largest commodity derivatives exchange by number of contracts traded.

Speaker #2: This reflects the confidence expressed in our markets by participants and reinforces our commitment to innovation, market development, and operational excellence. Looking forward, our focus remains on expanding participation, expanding our product suite, deepening liquidity across contracts, enhancing technology and market infrastructure, and creating sustainable long-term value for all shareholders.

Speaker #2: With this, I would also like to highlight a very, very strong focus for MCX on risk management. I think I have been asked this in a few discussions—where, in volatile environments and given the purpose of MCX being to operate as a platform for hedging—the action that has our top focus is risk management, and being able to react quickly to signals from across the world over the course of the last one year.

Praveena Rai: I think I have been asked this on a few discussions where, in volatile environments and the purpose of MCX being to operate as a platform of hedging, the action that has our top focus is risk management and being able to react quickly to signals from across the world over the course of the last 1 year. It has helped us to hold a very strong risk management posture and permit all the new participation products, innovation enhancements, et cetera, to actually play out. With this, I would like to thank our regulators, members, participants, dear investors, all our hardworking, dedicated employees, and all stakeholders for their continued trust and support with us. Thank you. We are open to questions. Our leadership team is available here.

Speaker #2: And this has helped us to maintain a very strong risk management posture and allow all the new participation products, innovations, enhancements, etc., to actually play out.

Speaker #2: With this, I would like to thank our regulators, members, participants, their investors, all our hardworking, dedicated employees, and all stakeholders for their continued trust and support in us.

Speaker #2: Thank you and we are open to questions. I'll leadership team is available here.

Speaker #1: Thank you. We will now begin the question and answer session. Anyone who wishes to ask a question may start, and one on touchstone telephone.

Operator 2: Thank you. We will now begin the question and answer session. Anyone who wishes to ask a question may press star 1 on touchtone telephone. If you wish to remove yourself from the question queue, you may press star 2. Participants are requested to use handsets while asking a question. As a reminder to all the participants, please restrict yourself for 2 questions. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question comes from the line of Amit Chandra with HDFC Securities. Please go ahead.

Speaker #1: If you wish to remove yourself from the question queue, you may press *2. Participants are requested to use handsets while asking a question.

Speaker #1: As a reminder to all participants, please restrict yourself to two questions. Ladies and gentlemen, we will wait for a moment while the question queue assembles.

Speaker #1: The first question comes from the line of Amit Chandra with HDFC Securities. Please go ahead.

Speaker #3: Yeah, thanks for the opportunity. My first question is on the recent RBI regulation regarding the bank guarantee. So, it's been a month. How do we see the impact of that on our volumes?

Amit Chandra: Yeah, thanks for the opportunity. Ma'am, my first question is on the recent RBI regulation regarding the bank guarantee. It's been a month, how do we see the impact of that on our volumes? Also, is it fair to say that the impact of this bank guarantee will be more gradual and it has not come maybe in the month of July, and as more and more bank guarantees come for renewal, the volume related to the prop trading will actually decline? Secondly, ma'am, if I see the mix of the volume, it is now getting more tilted towards the crude and natural gas contracts. Obviously, the volatility there is much higher. If I see the gold and silver contracts, there has been a substantial more than 100% rise in the notional volume, and it is continuing to rise.

Speaker #3: And also, is it fair to say that the impact of this bank guarantee will be more gradual and that it has not come, maybe, in the month of July?

Speaker #3: And as more and more bank guarantees come up for renewal, the volume related to the prop trading will actually decline. Secondly, ma'am, if I look at the mix of the volume, it is now getting more tilted towards the crude and natural gas contracts.

Speaker #3: Obviously, the volatility there is much higher. But if I see the gold and silver contracts, there has been a substantial, more than 100% rise in the notional volume.

Speaker #3: And it is continuing to rise. But there has been a fall in the P2Ns, which is leading to a fall in the premium numbers for gold and silver.

Amit Chandra: There has been a fall in the P-Notes, which is leading to a fall in the equivalent numbers for gold and silver. What is creating this shift and how we see the rise in the gold and silver volumes in the mix? Thank you.

Speaker #3: So what is creating this shift and how we see the rise in the gold and silver volumes in the mix? Thank you.

Speaker #2: Thank you, Amit. Very, very valid question. The first one is on everybody's mind, for sure. The regulation from RBI, which was meant to come into effect in April, had a 90-day sort of time period—just to get absorbed by the industry.

Praveena Rai: Thank you, Amit. Very, very valid question. The first one is on everybody's mind for sure. The regulation from RBI that was meant to come into effect in April had a 90-day time period for this to get absorbed by the industry. It is now in force. I do not want to comment because this is really more of a Q2 action than a Q1 action. Having said that, we are not expecting this to have a very significant detrimental impact. We will have to wait and watch what the actual impact of this turns out to be. It will have an implication on the cost of funds of some part of the flows associated with our members. We expect that to be optimal in nature as industry finds its own sort of mechanism to deal with it. Are we seeing anything significantly detrimental at this stage? I would say not really.

Speaker #2: Is now in force. I don't want to comment because this is really more of a Q2 action than a Q1 action. Having said that, we are not expecting this to have a very significant detrimental impact.

Speaker #2: We'll have to wait and watch what the actual impact of this turns out to be. It will have an implication on the cost of funds for some part of the flows associated with our members.

Speaker #2: We expect that to be optimal in nature, as the industry finds its own sort of mechanism to deal with it. Are we seeing anything significantly detrimental at this stage?

Speaker #2: I would say not really. The second point is the rise in ADT. Yes, we're very happy to see the growth in ADT—from about ₹3 lakh crore in Q1 last year to about ₹6.6 lakh crore in Q4.

Praveena Rai: The second point is the rise in ADT. Yes. We are very happy to see the growth in ADT from about INR 3 lakh crores in Q1 last year to about INR 6.6 lakh crores in Q4. We have seen INR 10.5 lakh crores of ADT, which demonstrates highly engaged participation across the contracts. Yes, there is a normalization of the premium ratio, and this is as expected because as we look at volatility trends globally, there will be a normalization of the way premium will play out.

Speaker #2: We have seen ₹10.5 lakh crore of ADT, which demonstrates highly engaged participation across the contracts. Yes, there is a normalization of the premium ratio.

Speaker #2: And this is as expected, because as we look at volatility trends globally, there will be a normalization in the way premium will play out.

Speaker #3: Okay. And ma'am, the second question is on the product pipeline. Obviously, in previous calls, you have mentioned that you’re working on a big pipeline of products, especially on the metal side and on the index side.

Amit Chandra: Okay. Ma'am, the second question is on the product pipeline. Obviously, in the previous calls you have mentioned about you are working upon a big pipeline of products, especially on the metal side and on the index side. If you can get an update, what is the status there in terms of where we are in terms of launching the newer metal contracts, because that is the gap that we see in the options portfolio.

Speaker #3: So if you can get an update, what's the status there in terms of yeah, where we are in terms of launching the newer metal contracts?

Speaker #3: Because that is the gap that we see in the options portfolio.

Speaker #2: So when it comes to metal contracts, I think we do see a lot of headroom. As you know, a lot of activity has happened on the baby rationalized warehouses simplified the contracts over time.

Praveena Rai: When it comes to metal contracts, I think we do see a lot of headroom. As you know, a lot of activity has happened on the way we have rationalized warehouses, simplified the contracts over time, and we have seen the impact of that, especially in the copper portfolio, the numbers that are playing out. This will continue to be a strong focus area to build depth in the contract.

Speaker #2: And we have seen the impact of that, especially in the copper portfolio. The numbers that are playing out. And this will continue to be a strong focus area to build depth in the contract.

Speaker #1: Thank you. Mr. Chandra, please rejoin the queue for more questions. Next question comes from the line of Devesh Agarwal with IFL Capital. Please go ahead.

Amit Chandra: Thank you. Mr. Chandra, please rejoin the queue for more questions. Next question comes from the line of Devesh Agarwal with IIFL Capital. Please go on.

Speaker #4: Yeah, good evening everyone, and thank you for the opportunity. Also, congratulations on a good set of numbers. Ma'am, my first question is on the traded UCC.

Devese Agarwal: Yeah. Good evening, everyone, thank you for the opportunity. Also, congratulations on good set of numbers. Ma'am, my first question is on the traded UCC. After two strong quarters, this quarter we are seeing a decline in the numbers. One, I wanted to understand what has led to this decline. Secondly, what according to you is the lead indicator in terms of addition of new traded UCCs? Is it the stronger prices or higher volatility which can drive the new UCCs?

Speaker #4: After two strong quarters, this quarter we have seen a decline in the numbers. One, I wanted to understand what has led to this decline.

Speaker #4: And secondly, what, according to you, is the lead indicator in terms of the addition of new traded UCCs? Is it stronger prices or higher volatility that can drive the addition of new UCCs?

Speaker #2: So we've had growth in UCCs quarter on quarter over the last few quarters. This is the impact of new members as well as expanded interest by participants in the commodity markets.

Praveena Rai: We've had growth in UCCs quarter on quarter over the last few quarters, which is the impact of new members as well as expanded interest by participants in the commodity derivative markets. We see a sea change this quarter, but I would say it's more or less at par with the last quarter. Last quarter, of course, was high given the fact that it was a highly volatile quarter with sort of lot of interest and a lot of opportunity that people would have seen. I think we see this as sort of a UCC-wise flat quarter where some of the participants would have come in and are not probably participating this quarter. The underlying strength of new members and new participants is a trend line that we still see as positive.

Speaker #2: We see a tag change this quarter, but I would say it's more or less at par with last quarter. Last quarter, of course, was a high, given the fact that it was a highly volatile quarter with a lot of interest and a lot of opportunity that people would have seen.

Speaker #2: So I think we see this as sort of a UCC wise flat quarter where some of the participants would have come in and are not probably participating this quarter.

Speaker #2: But the underlying strength of new members and new participants is a trend line that we still see as positive.

Speaker #4: And any number, ma'am, that you have in your mind possibly that you can reach in a year's time?

Devese Agarwal: Any number, ma'am, that you have in your mind possibly that you can reach in a year's time?

Speaker #2: You know, I don't want to put a number here. Yeah, last year we closed at 20 lakh at a full year number. And we do expect to have higher numbers this year.

Praveena Rai: I don't want to put a number here. Last year we closed at INR 20 lakh at a full year number, we do expect to have higher numbers this year. The headroom for growth continues to be substantive.

Speaker #2: And the headroom for growth continues to be substantial.

Speaker #1: Thank you. Mr. Agarwal, please rejoin the queue for more questions. The next question comes from the line of Suprateen with Jefferies. Please go ahead.

Operator 2: Thank you. Mr. Agarwal, please rejoin the queue for more questions. Next question comes from the line of Supratim with Jefferies. Please go ahead.

Speaker #3: Hi, thanks a lot for the opportunity. My first question, again, going back to RI regulation and the impact. Now, ma'am, thank you very much for the color that you have provided.

[Analyst] (Jefferies): Thanks a lot for the opportunity. My first question, again, going back to the RBI regulation and the impact. Ma'am, thanks a lot for the color that you have provided. If you could give us some sense around what proportion of the trades might be backed by bank guarantees currently or in last quarter, that would be helpful. That's one. Secondly, ma'am, there has been a lot of discussion around FPI participation and SEBI looking and we see that looking at the FPI participation being extended to contracts beyond energy. Any updates regarding that, any color regarding how you see that play out, that would be very helpful. Thank you.

Speaker #3: But if you could give us some sense around what proportion of the trades might be backed by bank guarantees currently, or in the last quarter, that would be helpful.

Speaker #3: So that's one. And secondly, ma'am, there has been a lot of discussion around FBI participation, and the Fed being looked at, and SEBI looking at the FBI participation being extended to contracts beyond energy.

Speaker #3: So, any update regarding that—or any color regarding how you see that play out—would be very helpful. Thank you.

Speaker #2: Sorry, could you please repeat the second question?

Praveena Rai: Sorry, can you repeat the second question, please?

Speaker #3: Yeah, sure. So, on the FPI participation—there have been articles recently suggesting that SEBI and the Commodity Derivative Action Committee are looking at expanding FPI participation to non-cash contracts as well.

[Analyst] (Jefferies): Yeah, sure. On the FPI participation, there have been articles recently suggesting that SEBI and the Commodity Derivatives Advisory Committee is looking at expanding FPI participation to non-cash contracts as well. Just wanted to understand that, any color around that? How do you see that play out and what kind of impact, if that's allowed, could take place on MCX? That would be very helpful.

Speaker #3: So just wanted to understand that any color around that, how do you see that play out and what kind of impact if that is allowed?

Speaker #3: Could take place on MCX. That would be very helpful.

Speaker #2: Yeah. So if your first question on trying to put a number on the impacted quantum of bank guarantees, if I understood your number right, so that's not something that yeah, that we have, right?

Praveena Rai: Yeah. Your first question on trying to put a number on the impacted quantum of bank guarantees, if I understood your number right.

[Analyst] (Jefferies): Yes.

Praveena Rai: That's not something that we have, right? Because at any point in time, it's oriented towards the prop quantum of a particular member and members also use multiple instruments. This varies every day based on margin calls, it's not a number we are able to put our handle on.

Speaker #2: Because at any point in time, it's oriented towards the prop quantum of a particular member. And members also use multiple instruments. This varies every day based on margin calls, so it's not a number we are able to put our handle on.

Chandresh Shah: Okay.

Speaker #2: But in our conversations with the markets, etc., it's sort of the perspective that I had given earlier on.

Praveena Rai: In our conversations, et cetera, with the market is sort of the perspective that I had given earlier on.

Speaker #3: Understood. Understood.

[Analyst] (Jefferies): Understood.

Praveena Rai: Yeah. FPI is something that we'll of course wait for. We are keen, no doubt about it. We are awaiting progress on this count. This has been in the media. I think we'll stay with what's available in public domain as the sort of details on this get worked through.

Speaker #2: Yeah, FBI is something that we'll, of course, wait for. We are keen, no doubt about it. We are awaiting sort of progress on this count.

Speaker #2: This has been in the media. I think we'll stay with what's available in the public domain as the sort of details on this get worked through.

Speaker #3: Got it. Thank you.

[Analyst] (Jefferies): Got it. Thank you.

Speaker #1: Thank you. Next question comes from the line of Adarsh Singh with ASK Private Wealth. Please go ahead.

Operator 2: Thank you. Next question comes from the line of Adarsh Singh with ASK Private Wealth. Please go ahead.

Speaker #4: Yes, sir. My question would be that if you see energy, and particularly crude and natural gas, that contributes a large part of our overall revenue.

Adarsh Singh: Yes. My question would be that if you see energy and particularly crude oil and natural gas, that contributes a large part of our overall revenue. If we say going forward, when the volatility reduces, let's say a year forward, of course, the contribution from them would start lowering. If you see like two, three years forward, and new energy sources would come, the contribution from particularly natural gas and crude would come down. What are our new products or let's say, for example, index options that you are trying to scale. What is the fraction there to counter the impact of crude and natural gas?

Speaker #4: But if you say going forward, when the volatility reduces, let's say a year forward, of course, the contribution from them would start lowering and if you see, let's say, two to three years forward, new energy sources would come. The contribution from particularly natural gas and crude would come down.

Speaker #4: So, what are our new products, or, let's say, for example, index options that you are trying to scale? And what is the traction there to counter the impact of crude and natural gas?

Speaker #2: You know, I wouldn't link these two. Adarsh, I think your question, if I were to just take it at one level and say, what is the sort of approach to manage multiple products in the portfolio, right?

Praveena Rai: I wouldn't link these two, Adarsh. I think your question, if I were to just take it at one level and say, what is the sort of approach to manage multiple products in the portfolio, right? I think we've seen in the recent days that countries are going to continue to be reliant on crude and gas, as we also work towards policy initiatives on self-reliance, gasification through coal, various other measures that are in play. As you know, we've launched a power contract and electricity contract which has picked up pretty well. We are looking at more participation from the power players starting to make inroads, including with the discounts. Good open interest build-up. A lot of the lead indicators on that look positive. The coal initiative we spoke about, it's not a derivatives initiative at this point. It's a coal exchange.

Speaker #2: I think we've seen in recent days that countries are going to continue to be reliant on crude and gas. As we also work towards policy initiatives on self-reliance, gasification through coal, and various other measures that are in play.

Speaker #2: As you know, we have launched the power contract and electricity contract, which has picked up pretty well. We are looking at more participation from the power players starting to make inroads, including with the discounts would open interest build up.

Speaker #2: So, a lot of the lead indicators on that look positive. The coal initiative we spoke about—it's not a derivatives initiative at this point.

Speaker #2: It's a coal exchange. But having this foundation is very important as we move forward. So, really, covering the coal energy basket is sort of the fundamental idea in that space.

Praveena Rai: Having this foundation is very important as we move forward. Really covering the whole energy basket is sort of the fundamental idea in that space. Your question on indices. I think indices is a place that we will continue to be working on. The BullDex that was launched last year, I think there's a rework on the product that is in play both on the futures and options. I think we are expecting that to give a good bump up on indices. Indices is something that is a primary focus both across the bullion metal and the overall commodity space as well. There are few plans that are currently in pipeline. Over the next few months, they will hit the market which we will be able to announce from time to time.

Speaker #2: Your question on indices? I think indices is a place that we will continue to be working on. The BULDEX that was launched last year, I think there's a rework on the product that is in play.

Speaker #2: Both on the futures and options. So, I think we are expecting that to give a good bump up on indices. Indices are something that is a primary focus both across the bullion, metal, and the overall commodity space as well.

Speaker #2: There are a few plans that are currently in the pipeline. Over the next few months, they will hit the market, which we will be able to announce from time to time.

Adarsh Singh: Okay. Thanks.

Speaker #4: Okay. Thanks.

Speaker #1: Thank you. The next question comes from the line of Niranjan Kumar with Evan Deshpate. Please go ahead.

Operator 2: Thank you. Next question comes from the line of Niranjan Kumar with Evan Desk Path. Please go ahead.

Niranjan Kumar: Thank you for giving the opportunity. I have two questions. One on the IPF contribution. On a QOQ basis in this quarter, the decline was lower than the decline witnessed in revenue transaction income. Is it broadly because of the market-based activity or because of the change in the calculation methodology by SEBI in March? That is first question. Second question, the employee cost or the growth which you have seen in this quarter, is it largely driven by increments or by the employee count addition? Like is this a sustainable number going yet? Those are the two broad questions.

Speaker #4: Thank you for giving me the opportunity. I have two questions. One is on the edge of contribution. On a QoQ basis, in this quarter, the decline was lower than the decline witnessed in revenue transaction income.

Speaker #4: So, is it broadly because of the market-based activity, or because of the change in the calculation methodology by SEBI in March?

Speaker #4: That's the first question. Maybe the second question: the employee cost, the growth which we have seen this quarter, is it largely driven by increments or by employee count addition?

Speaker #4: Like, is this the sustainable number? I mean, going there—those are the two broad questions.

Chandresh Shah: Hi, Niranjan. This is Chandresh. On your first question about IPF. IPF is a function of a lot of parameters, and SEBI has prescribed the methodology based on which calculations are done every month, actually. The contribution again depends on the assessment of whether we have to infuse more in the fund based on this calculation and how much we want to have some safety net buffer headroom above the calculation that comes as per SEBI methodology. Depending on that, the analysis is done, and the contribution is done. That is the reason maybe you can see some variation in the IPF number. In terms of employee cost. Yeah. It is a mix of both addition of new employees plus increments. Also a bit of maybe a slightly higher variable pay in our subsidiary, which has come up in this year.

Speaker #5: Hi Niranjan, this is Chandresh. On your first question about LCF—yes, LCF is a function of a lot of parameters, and SEBI has prescribed the methodology based on which calculations are done every month, actually.

Speaker #5: And the contribution again depends on the assessment of whether we have to infuse more into the fund based on this calculation, and how much we want to have as some safety net, buffer, or headroom above the calculation that comes as per SEBI methodology.

Speaker #5: So depending on that, the analysis is done and the contribution is done. So that's the reason maybe you can see some variation in the LGF number.

Speaker #5: And in terms of employee cost, yes, it’s a mix of both the addition of new employees plus increments, and also maybe a slightly higher variable pay in our subsidiary.

Speaker #5: Which has come up this year. So I think, otherwise, the expenses are in line with what we have seen and what we expect to be there in the future.

Chandresh Shah: I think otherwise the expenses are in line with what we have seen and what we expect to be there in future.

Speaker #4: Got it, Chandresh. Any broad color on how much of the increase might be attributed to employee count, or the bonus, or the variable payout you mean to say?

Niranjan Kumar: Because it is a maybe any broad color, like how much of the increase might be attributed to employee count or the bonus or the pay out variable pay out you meant to say. That should summarize it. Yeah.

Speaker #4: No, that's it from me. Yeah.

Speaker #5: So I think, see, we keep hiring people based on—there is a one-time of around 8% to 9% included in this, which will not be there in the coming quarters.

Chandresh Shah: I think, see, we keep hiring people-

Praveena Rai: No, he's asking what is the one time?

Chandresh Shah: There is a one time of around 8% to 9% included in this, which will not be there in the coming quarters.

Speaker #1: Thank you. Mr. Kumar, please see if John is in the queue for more questions. The next question comes from the line of Shrenik Mehta with Indo Alps Wealth.

Operator 2: Thank you. Mr. Kumar, please rejoin the queue for more questions. Next question comes from the line of Shrenik Mehta with InCred Wealth. Please go ahead.

Speaker #1: Please go ahead.

Speaker #4: Hello. My question is about the bullion options notional ADP, which rose almost 116 percent sequentially, while the bullion options premium ADP fell 27 percent.

Shrenik Mehta: My question is about the Bullion Options notional ADT, which rose almost 116% sequentially, while the Bullion Options premium ADT fell 27%. This is taking the premium to notional from 1.03% to 0.35%. Now, since the transaction revenue is a function of a premium and not notional, can you decompose this 68% yield compression, say, across four buckets? A mechanical notional inflation from higher gold and silver prices levels, one. Number two, implied volatility normalization post Q4 spike. Number three, participation mix shift towards further OTM and shorter-dated strikes, and the contract mix from Silver 100 to the Gold Ten and the BullDex. What is the contribution of each and which of these do you think are structural rather than the cyclical ones? Just want to understand the future idea a little better with this feedback.

Speaker #4: So this is taking the premium-to-notional from 1.03 percent to 0.35 percent. Now, since the transaction revenue is a function of premium and not notional, can you decompose this 68 percent e-compression pay across four buckets?

Speaker #4: Mechanical, notional inflation from higher gold and silver price levels—one. Number two, implied volatility normalization post Q4 spike. Number three, participation mix shift towards further OTM and shorter-dated strikes.

Speaker #4: And the contract mix from Silver 100 to the Golden Gold 10 and the BULDEX. What is the contribution of each? And which of these do you think are structural rather than the cyclical ones?

Speaker #4: This one is to understand the future idea a little better with this feedback.

Speaker #2: Yeah, so I think I'll just take your first part, and then I'll request that you probably need to come in. So, when it comes to price-related, right?

Praveena Rai: Yeah. I think I'll just take your first part, and then I'll request Praveen to come in. When it comes to price related, right? Let's move from ADT, which is average daily throughput, to average daily volume, which eliminates the price component. We are looking at, for example, in gold, something like ADV, average daily volume in options of about 300 metric tons, which is 100% increase over last quarter. Similarly, we are looking at in silver about 9,400 metric tons, which is again approximately 2% or more increase over last quarter.

Speaker #2: So, let's move from ADP, which is average daily throughput, to average daily volume, which eliminates the price component. So we are looking at, for example, in gold, something like ADV—average daily volume—in options of about 300 metric tons.

Speaker #2: Which is a 100 percent increase over last quarter. And similarly, we are looking at, in silver, about 9,400 metric tons, which is again approximately a 2 percent or more increase over last quarter.

Speaker #2: So, volume-wise, it's healthy. There is that sort of price impact kicking in. Volatility is certainly a determining factor. Probably need to just comment on that.

Praveena Rai: volume wise, it will be. There is that sort of price impact kicking in. Volatility is certainly a determining factor. Praveen, if you want just comment on that.

Speaker #4: Yeah. So just like India said, it is like predominantly it is a market factor because you can really could see that from a heightened volatility, it is now more has lowered.

Praveen DG: Yeah. Just like Sandhya has said, predominantly it is a market factor because you can really could see that from a heightened volatility it is now more has lowered. Stability, like the volatility has come down significantly in both gold as well as in silver. That way that is what actually the contributor to this decline in the premium ratio.

Speaker #4: The stability, like the volatility, has come down significantly in both gold as well as in silver. So, that way, that is what actually is the principal contributor to this decline in the premium ratio.

Speaker #3: Okay. All right. Thank you.

Niranjan Kumar: All right. All right, thank you.

Praveena Rai: The contract mix is not where we are seeing the depletion.

Speaker #2: It is not where we are seeing the big play.

Speaker #4: Can you use that?

Shrenik Mehta: Volume is not-

Speaker #3: Yeah. Participation-wise, if you look at even the premiums of both gold and silver, both are almost at the same levels. So, in that way, it is not significantly contributing to this one.

Praveen DG: Yeah. Participation-wise, if you can look at even the premiums of both gold and silver, both are almost at the same level. That way it is not significantly contributing to this one. In fact, the participation also, we can say that there is no major impact. The participation remains stable compared to the last quarter. That way, I don't see that there's any shift in the participation or because of the change in the contract mix, that those are not the contributors.

Speaker #3: In fact, regarding participation, we can say that there is no major impact—the participation remains stable compared to the last quarter. So, in that way, I don't see any shift in participation or any effect due to the change in the contract mix.

Speaker #3: Those are not the contributors.

Speaker #4: So I'll just come in. Shivanshu here. While you've correctly noted that the notional turnover has increased, and as we clarified, so has the volume.

Shivanshu Mehta: I'll just come in, Shivanshu here. While you correctly noted that the notional turnover has increased, and as we clarified, so has the volume. Volume, since it's irrespective of price, it is ideally a lead indicator or an actual indicator of participation. Actually, options is starting to see more and more usage for the design purpose for which it's created, the environment which we saw. Now, even if you look at the open interest, which is another such parameter, even on that count, there is an increase. If you see the silver all-variant option, OI, as well as the gold all-variant OI options, which is about 17.3 tons, marginally higher than 16.9. In the case of silver, 583 tons as opposed to 522 tons in the previous quarter.

Speaker #4: And volume, since it's irrespective of price, is ideally a lead indicator or an actual indicator of participation. Actually, options are starting to see more and more usage for the design purpose for which they were created, in the environment that we saw.

Speaker #4: Now, even if you look at the open interest, which is another such parameter, even on that count there is an increase. If you see the silver all variant option OI as well as the gold all variant OI in options, which is about 17.3 tons, it is marginally higher than 16.9.

Speaker #4: In the case of silver, 583 tons, as opposed to 522 tons in the previous quarter.

Speaker #3: In spite of the volume remaining quite similar, you still see a decline in the premium, right? So, that is because of the volatility, you're saying.

Shrenik Mehta: In spite of volume remaining quite similar, you still see a decline in the premium, right? That is because of the volatility you're saying.

Speaker #4: Yes, that's right. That keeps changing from time to time actually, depending on the market factors. But the products which we create are actually permanent in nature, and they are indicating more participation.

Shivanshu Mehta: Yes.

Shivanshu Mehta: That's right.

Shivanshu Mehta: that's right. That keeps changing from time to time actually, depending on what the market factors. The products which we create are actually permanent in nature, and they are indicating more participation. Premium coming and going is a function of various market conditions, actually.

Speaker #4: So, premium coming and going is a function of various market conditions, actually.

Speaker #1: Thank you. Mr. Mehta, please rejoin the queue for more questions. The next question comes from the line of Abhijit with Kotak Securities. Please go ahead.

Operator 2: Thank you. Mr. Mehta, please rejoin the queue for more questions. Next question comes from the line of Abhijit with Kotak Securities. Please go ahead.

Speaker #5: Hey, hi. Good evening, everyone. Thanks for the opportunity, and congratulations on a good set of numbers. I had one question on technology cost. If you could give some color on where we are in terms of adequacy towards maintaining the right amount of capacity, given what we saw in the previous quarter in terms of growth and volumes.

[Analyst] (Kotak Securities): Hi. Good evening, everyone. Thanks for the opportunity, and congrats on good set of numbers. I had one question on technology costs, if you could give some color on where we are in terms of adequacy towards maintaining the right amount of capacity, given what we saw in the previous quarter in terms of growth in volumes. If internally we kind of have a benchmark in terms of where we put the capacity numbers against the volumes that we see in the recent periods. Thank you.

Speaker #5: And if internally, we kind of have a benchmark in terms of where we put the capacity number against the volumes that we see in the recent periods.

Speaker #5: Thank you.

Speaker #2: So I think, as stated in all our earlier discussions, we continue to invest in the technology space. And when I say invest, I think it is about investing smartly and investing efficiently.

Praveena Rai: I think as stated in all our earlier discussions, we continue to invest in the technology space. When I say invest, I think it is invest smartly and invest efficiently. It is our, of course, after risk and compliance, our very top priority. At this stage, we are working towards a high degree of scale being available. In fact, just in the last one year, we have very successfully handled transactions. We would have started the year at less than a billion. When I say a year, I am talking of maybe four quarters back, a billion transactions a day. We have already handled more than three billion transactions a day with the capacity to handle more than double that. Capacity-wise, very well-positioned as we speak in terms of the growth that is coming our way.

Speaker #2: So, it is our—of course, after risk and compliance, which are very top priority. At this stage, we are working towards a high degree of scale being available.

Speaker #2: In fact, just in the last one year, we have very successfully handled transactions. We would have started the year at less than $1 billion.

Speaker #2: And when I say a year, I'm talking about maybe four quarters back. A billion transactions a day. And we've already handled more than three billion transactions a day.

Speaker #2: With a capacity to handle more than double that. So, capacity-wise, we are very well positioned as we speak in terms of the growth that is coming our way.

Speaker #2: But we continue to look to drive resiliency, looking at driving scale. We've, of course, got Sanjay Rajpal as a new Executive Director for particular operations and technology, who's joined us.

Praveena Rai: We continue to look to drive resiliency, looking at driving scale. We've, of course, got Sanjay Rajpal as a new Executive Director for technical operations and technology who's joined us. Making sure that this technology platform readiness for scale and resilience in an efficient cost-managed manner is a top priority for us.

Speaker #2: And making sure that this technology platform's readiness for scale and resilience, in an efficient cost management manner, is a top priority for us.

Speaker #5: Got it. Thanks a lot.

[Analyst] (Kotak Securities): Got it. Thanks a lot.

Operator 2: Thank you. Next question comes from the line of Parikshit Gupta with Fair Value Capital. Please go ahead.

Speaker #1: Thank you. The next question comes from the line of Parikshit Gupta with Fair Value Capital. Please go ahead.

Speaker #5: Thank you very much for the opportunity. I have a few questions on the electricity futures, and with some context from the Electricity Performance Report that you have published for FY26.

Parikshit Gupta: Thank you very much for the opportunity. I have a few questions on the electricity futures and with some context from the electricity performance report that you have published for FY26. The first question, what was the Q1 traded volumes for electricity futures? In terms of the overall market share, where do we tentatively stand with the Q1 numbers?

Speaker #5: So the first question: What were the Q1 traded volumes for electricity futures? And, in terms of the overall stance, with the Q1 numbers?

Speaker #2: So, electricity futures Q1 ADT is about ₹37 crore. We stand at, I think, about 55% or so from a market share standpoint when it comes to ADT.

Praveena Rai: Electricity futures Q1 ADT is about INR 37 crore. We stand at about 55% or so from a market share standpoint when it comes to ADT. However, what we've done over the course of the year is really look at studying our market needs very carefully. We have a strong reinforcement that our contract is very much aligned to market needs. This is reflected in liquidity that is across more than 3 months, so month 1, 2, and 3 with open interest where we have nearly 1,630 lots of contracts of open interest which is more than 70% in the market share. Which really is a reflection of the actual utilization for the market from an electricity future standpoint.

Speaker #2: However, what we've done over the course of the year is really look at studying our market needs very carefully. And we have strong reinforcement that our contract is very much aligned to market needs.

Speaker #2: And this is reflected in liquidity that is across more than three months—so, month one, two, and three—with open interest, where we have nearly 1,630 lots of contracts of open interest.

Speaker #2: Which is more than 70, yeah, more than 70% in the market share. Which really is a reflection of the actual utilization for the market from an electricity futures standpoint.

Speaker #5: Okay, this is helpful. The second question: from the same report that you have published, it is mentioned that in India, the traded volumes are at around 70 bps of the total deliverable supply.

Parikshit Gupta: Okay, this is helpful. The second question from the same report that you have published, it is mentioned that in India the traded volumes are at around 70 basis points of the total deliverable supply. While in Europe, China, or America, all of these are a healthy multiple of the deliverable volumes. In the next 3 years, how much do we anticipate this ratio to evolve to? Just add a follow-up to this. In the same report, you have also mentioned that around 40% of this participation or this trading is through algorithmic trading. However, it does not say if these algo traders are hedgers or speculators. Do we have any insights into this? Going forward, which category do we expect to offer a higher growth rate?

Speaker #5: While in Europe, China, or America, all of these are a healthy multiple of the deliverable volumes. So, in the next three years, how much do we anticipate this ratio to evolve to?

Speaker #5: And just to add a follow-up to this, in the same report, you have also mentioned that around 40% of this participation or this trading is through algorithmic trading.

Speaker #5: However, it does not say whether these algo traders are hedgers or speculators. Do we have any insights into this? And going forward, which category do we expect to offer a higher growth rate?

Praveena Rai: Parikshit, which report are you referring to?

Speaker #2: Parikshit, which report are you referring to?

Speaker #5: The electricity performance report, which is on the MCX website.

Parikshit Gupta: The electricity performance report which is on the MCX website.

Speaker #2: Okay, so we don't have that handy in front of us. What I can tell you is, when we look at the power markets, about 8% to 10% of electricity needs on a day-to-day basis are really transacted through the spot exchanges.

Praveena Rai: Okay. We don't have that handy in front of us. What I can tell you is when we look at the power markets about 8% to 10% of electricity needs on a day-to-day basis are really transacted through the spot exchanges. That is the fundamental driver to reflect the sort of price discovery, and the fact that there are a range of both generators, as well as distributors and consumers who utilize the exchange. This is the price on which MCX settles the contract. It is fully generators, distributors, and consumers in India, and they are the same participants in addition, of course, financial participants. They are the same participants who also participate on MCX on the derivatives contract. This is the broad brush. Maybe since we don't have the report in front of us, we don't have the specificities of the questions you are asking.

Speaker #2: And that is the fundamental driver to reflect the sort of price discovery, and the fact that there are a range of both generators as well as distributors and consumers who utilize the exchange.

Speaker #2: This is the price on which MCX settles the contract. It fully includes generators, distributors, and consumers in India, and they are the same participants in addition to, of course, financial participants.

Speaker #2: They are the same participants who also participate on the MCX on the derivatives contract. So, this is the broad brush. I didn't—maybe, since we don't have the report in front of us, we don't have the specificities of the questions you're asking.

Speaker #2: Can you repeat your question?

Praveena Rai: Can you repeat your question?

Speaker #5: Yes, sure. And let me just rephrase it. So, what I was trying to ask was: in the European or American markets, the derivative trading of electricity is a multiple of the spot trading on the exchanges.

Parikshit Gupta: Yes, sure. Let me just rephrase it. What I was trying to ask was, in the European or American markets, the derivative trading of electricity is a multiple of the spot trading on the exchanges. In India, we are at 70 basis points. It is actually a very low number. Given that we are participating in the electricity futures market, I just wanted to check for the next 3 to 5 years or the medium term, how are we anticipating the share of the derivative markets as a percentage of the spot markets to evolve? If this growth will be coming from more speculators or hedgers.

Speaker #5: And in India, we are at 70 basis points, so it's actually a very low number. Given that we are participating in the electricity futures market, I just wanted to check—for the next three to five years, or the medium term—how are we anticipating the share of the derivative markets as a percentage of the spot markets to evolve?

Speaker #5: And will this growth be coming from more speculators or hedgers?

Speaker #2: So, great. There are two parts to your question. I think the first part is: what do we think is going to be the multiple of derivative contracts over spot contracts?

Praveena Rai: Great. There are two parts to your question. I think the first part is, what do we think is going to be the multiple of derivative contracts over spot contracts? We absolutely expect this to be reflective of what we see in global markets. We are in the really early phase of this journey, and like I said, all the lead indicators are looking strong. We have a strong feedback from market. Because any new product introduced, also we need to be really sure that despite having done the work or the approvals, that the product meets purpose. That is reconfirmed by market, and we have the right participation coming on board. We have the right open interest building up. As the lead indicators are positive, I think this will grow to be a very strong contract for India, reflecting what we are seeing globally.

Speaker #2: We absolutely expect this to be reflective of what we see in global markets. So, we are in the really early phase of this journey.

Speaker #2: And, like I said, all the lead indicators are looking strong. We have strong feedback from the market. Because any new product introduced, also, we need to be really sure that, despite having done the work or the approvals, the product meets its purpose, so that is reconfirmed by the market.

Speaker #2: And we have the right participation coming on board. We have the right open interest building up. So all the lead indicators are positive; I think this will grow to be a very strong contract for India, reflecting what you're seeing globally.

Speaker #2: We also work very closely with some of the global power exchanges, continuously studying how they approach their market dynamics so that we really don't have to reinvent the wheel, and we are learning from the best there.

Praveena Rai: We also work very closely with some of the global power exchanges, continuously studying how they approach their market dynamics, so that we ideally don't have to reinvent the wheel, and we are learning from the best there. The second question you asked is what is the kind of participation. Any healthy contract requires financial participants as well as commercial or hedging participants, so both may be hedging. Both may be investing, some may be speculating. We wouldn't know about that. We need all kind of participants to make sure that we have enough depth in the contract to have a vibrant market, so that any kind of player, when they come into the market to treat it as a hedging instrument, they find the liquidity that they need. The same objective plays out here, too.

Speaker #2: The second question you asked is: what is the kind of participation? So, any healthy contract requires financial participants as well as commercial or hedging participants.

Speaker #2: So, both may be hedging, both may be investing. Some may be speculating—we wouldn't know about that. But we need all kinds of participants.

Speaker #2: To make sure that we have enough depth in the contract to have a vibrant market, so that any kind of player, when they come into the market to treat it as a hedging instrument, they find the liquidity that they need.

Speaker #2: So the same objective plays out here too.

Speaker #5: Thank you. Mr. Gupta, please rejoin the queue for more questions. The next question comes from the line of Panti Chawla. Please go ahead.

Operator 2: Thank you. Mr. Gupta, please return to the queue for more questions. Next question comes from the line of Pankti Chawla with Ask. Please go ahead.

Speaker #3: Thank you for giving me the opportunity. My questions have been answered. Just one question on other income: we have seen a drastic growth both on a sequential as well as on a year-on-year basis.

Pankti Chawla: Thank you for giving me the opportunity. My questions have been answered. Just one question. On other income, we have seen a drastic growth on a sequential as well as a YY basis. What are the components or what are the drivers behind that, and how one should see this for full year FY2027?

Speaker #3: What are the components, or what are the drivers behind that? And how should one see this for the full FY27?

Speaker #2: No, I think it's yes. So, no, it's a very good question. I think, like we opened the discussion saying, we've had extremely sharp growth in Q4, reflecting a lot of macro-environmental factors as well.

Praveena Rai: No, I think it Yeah. Good question. No, it's a very good question. I think, we opened the discussion saying that we've had extremely sharp growth in Q4, reflecting a lot of macro environmental factors as well. We see that while it moderates, it consolidates and demonstrate a strong baseline level, where the exchange growth continues to be strong. We do see growth to be on a strong track this year. While those very strong macro factors may or may not necessarily kick in. That's not something that is in our controllable. All the controllables have strong indicators, and we do expect the numbers to be strong.

Speaker #2: We see that, while it moderates, it consolidates and demonstrates a strong baseline level where the exchange growth continues to be strong. So we do see growth to be on a strong track this year.

Speaker #2: While the very strong macro factors may or may not necessarily kick in, that's not something that is in our control. But for all the controllables, we have strong indicators and we do expect the numbers to be strong.

Speaker #3: Thank you.

Speaker #5: Thank you. Next question comes on the line of Sankit Goda with Evan Deshpake. Please go ahead.

Pankti Chawla: Thank you.

Operator 2: Thank you. Next question comes from the line of Sanket Goda with Avendus. Please go ahead.

Speaker #3: Yeah, thank you for the opportunity. Ma'am, in your initial remarks, you said that most of the mutual funds have started using MCX price as a benchmark to calculate their AUM.

Sanket Goda: Yeah. Thank you for the opportunity. Ma'am, in your initial remarks, you said that few mutual funds have started using MCX price as a benchmark to calculate their AUM. Just wanted to understand this data related income opportunity, how much it contributed probably in the current quarter's revenue, and how do you see this to play out in subsequent years as more and more mutual funds probably start using your price in that sense? That's my first question. Second is a data keeping. Can you call out your float income that is which is part of your operating income, what you earned on margin money?

Speaker #3: So, I just wanted to understand this data-related income opportunity—how much it contributed, probably in the current year's current quarter's revenue? And how do you see this playing out in subsequent years, as more and more mutual funds probably start using your price, in that sense?

Speaker #3: So that's my first question. And second is on data keeping. Can you call out your float income, that is, the portion which is part of your operating income—the float income you earned on margin money?

Speaker #2: Yeah. So, with respect to the AMCs, what was important was for us to establish the process and establish the kind of needs that they have, and to make sure that we are able to provide what the funds require.

Praveena Rai: Yeah. With respect to the AMCs, what was important is for us to establish the process and establish the kind of needs that they have, and to make sure that we are able to provide what the funds require. I think that's really been the focus in the last quarter, and each fund would have had to go to their board and get their policies approved and all those actions without sort of complicating it with a revenue stream objective at this point. I think we are focused on getting this service oriented suitably to the needs of the market. We do believe that both implicit and explicit streams of revenue will follow. We do have some plans around data services over and above what we have today, which over the next couple of quarters, I think we'll be able to share more.

Speaker #2: So I think that's really been the focus in the last quarter, and each fund would have had to go to their board and get their policies approved, and all those actions, without sort of complicating it with a revenue stream objective at this point.

Speaker #2: So, I think we are focused on getting this service oriented suitably to the needs of the market. And we do believe that both implicit and explicit streams of revenue will follow.

Speaker #2: We do have some plans around data services, over and above what we have today. Over the next couple of quarters, I think we'll be able to share more.

Speaker #3: Understood. And can you share the float income numbers? Sorry.

Sanket Goda: Understood. Can you share the float income numbers?

Speaker #5: That is around ₹30 crore for this quarter. Thank you. Mr. Goda, please rejoin the queue for more questions. The next question comes from the line of Shravan Kumar, an individual investor.

Chandresh Shah: That is around INR 30 crores for this quarter.

Operator 2: Thank you. Mr. Khoda, please rejoin the queue for more questions. Next question comes from the line of Shravan Kumar and Individual Investor. Please go ahead. Mr. Kumar, please go ahead with your question. Mr. Kumar, please unmute yourself and go ahead with your question. Since there is no reply from the line of Mr. Kumar, we'll move to the next, that is Saket Sarogi, an individual investor. Please go ahead.

Speaker #5: Please go ahead. Mr. Kumar, please go ahead with your question. Mr. Kumar, please unmute yourself and go ahead with your question. Since there is no reply from the line of Mr. Kumar, we'll move to the next.

Speaker #5: That is Sakit Sarogi, an individual investor. Please go ahead now.

Speaker #3: Hello. Ma'am, my question is regarding the sequential dip in the volumes, like the revenue of the company. What led to the decline in revenue in this quarter?

Saket Sarogi: Hello. Ma'am, my question is regarding the sequential dip in the volumes. There's a revenue of the company. What led to the decline in the revenue in this quarter?

Speaker #2: Yeah, Sakit, I think we were talking about that. Thank you for your question. So, Q4 last year was certainly a very, very strong quarter.

Praveena Rai: Yeah. Saket, I think we were talking about that. Thank you for your question. Q4 last year was certainly a very strong quarter. It was driven both by baseline fundamental increase in our number of members, participation, drive from sort of new products and so on, along with some of the big macro geopolitical factors that kicked in a very significant way. What we are seeing this quarter is a normalization of that without some of those sort of very strong geopolitical factors playing in at that same extent. With some of the fundamental and foundational growth elements still continuing to be strong. We are seeing growth vis-a-vis Q1 of last year. A very strong growth vis-a-vis Q1 of last year. While yes, of course, when compared to Q4, the numbers are lower from where they were.

Speaker #2: It was driven both by a fundamental increase in our number of members and participation, driven by new products and so on, along with some of the major macro-geopolitical factors that kicked in in a very significant way.

Speaker #2: So, what we are seeing this year is normal for this quarter—so, normalization of that—without some of those very strong geopolitical factors playing in to the same extent.

Speaker #2: But with some of the fundamental and foundational growth elements still continuing to be strong, we have seen growth. These are for Q1 of last year.

Speaker #2: There has been very strong growth vis-à-vis Q1 of last year. While, yes, of course, when compared to Q4, the numbers are lower than where they were.

Speaker #3: So, one follow-up, ma'am. Like last year, there has been a stupendous rise in the price of silver and gold. That could have aided the volumes of our products.

Saket Sarogi: One follow-up, ma'am. Like last year there has been a tremendous rise in the prices of silver and gold that could have aided the volumes of our products. This year, more or less, the price has been stable quite a bit. Also on the other side, the equity part of the market, those have started becoming a bit buoyant. Those are factors too because silver and gold being the major contributor to our revenue. Will that have an impact on the volumes this year?

Speaker #3: So this year, more or less, the price has been quite stable. And also, on the other side, the equity part of the market has started becoming a bit buoyant.

Speaker #3: So, do all those factors matter, considering silver and gold are the major contributors to our revenue? Will that have an impact on the volumes this year?

Speaker #2: Between our two big pillars of product segments, which are energy and bullion, we do see a sort of counterbalancing that tends to happen.

Praveena Rai: Between our two big pillars of product segments, which is energy and bullion, we do see a sort of a counterbalancing that tends to happen. Of course, sometimes both are highly volatile, but otherwise we do have energy sort of kicking in and contributing to numbers at times when bullion tends to be a little more tepid and vice versa. Having said that, I don't think we are still looking at an environment where bullion volatility is very low. It still continues to be at certain numbers where market requires to hedge and sort of use the platform for its regular business purposes as well.

Speaker #2: Of course, sometimes both are highly volatile, but otherwise, we do have energy sort of kicking in and contributing to the numbers at times when bullion tends to be a little more tepid, and vice versa.

Speaker #2: Having said that, I don't think we are still looking at an environment where bullion volatility is very low. It still continues to be at certain levels where the market requires participants to hedge and use the platform for their regular business purposes as well.

Speaker #5: Thank you. Mr. Sarogi, please rejoin the queue for more questions. The next question comes from Aditya Cheda with Incred Asset Management. Please go ahead.

Operator 2: Thank you. Mr. Sarogi, please rejoin the queue for more questions. Next question comes from the line of Aditya Chheda with Incred Asset Management. Please go ahead.

Speaker #3: Yeah. Hi, good evening. Thank you for the opportunity. My question is on the competitive intensity. Some of the challenger exchanges have become active in these segments.

Aditya Chheda: Hi, good evening. Thank you for the opportunity. My question is on the competitive intensity. Some of the challenger exchanges have become active in these segments. Are we tracking any leading indicators maybe something such as new member registrations, et cetera that would help us foresee any competitive intensity in this segment from us?

Speaker #3: So, are we tracking any leading indicators—maybe something such as new member registrations, etc.—that would help us foresee any competitive intensity in this segment for us?

Speaker #2: Yes. So, of course, commodities have been doing well. Numbers are good. Growth is high. So competition is stepping in, and we are taking it seriously because these are big competitors in adjacent spaces on the equity side.

Praveena Rai: Yes. Of course, commodities have been doing well. Numbers are good, growth is high. Competition is stepping in and we are taking it seriously because these are big competitors in the adjacent spaces in the equity side. We are staying focused on launching products that the market requires, looking at enhancing our participation. In the last quarter, we've had 12 new members who have joined. We've had 35 new FPIs taking our FPI count to about 220 at a higher base of INR 10 lakh plus crore. We have about 2.5% contribution coming from FPIs. Of course, looking forward to more as policy permits us to bring in more participation across contracts on FPIs. Having said that, we are watching competitive activity closely. At this stage I think all our main contracts with add-on competition have held strong.

Speaker #2: We are staying focused on launching products that the market requires and looking at enhancing our participation. So, in the last quarter, we've had 12 new members who have joined.

Speaker #2: We've had 35 new FPIs taking our FPI count to about 220. At a higher base of 10 lakh plus crore, we have about 2 and a half percent contribution coming from FPIs.

Speaker #2: And, of course, we look forward to doing more as policy permits us to bring in more participation across contracts on FPIs. Having said that, we are watching competitive activity closely at this stage.

Speaker #2: I think all our main contracts with head-on competition have held strong. There have been some competitive actions on expiry date changes and so on and so forth.

Praveena Rai: There have been some competitive actions on sort of expiry date change and so on and so forth. We are reviewing the impact of that. They sort of tend to have volume for about a couple of days on days where we have not seen that impact our own volume. It's something that we are watching slowly and we will have our action plan oriented to it as well.

Speaker #2: So we're reviewing the impact of that. They sort of tend to have volume for about a couple of days. On days where we have not seen that impact, our own volume...

Speaker #2: But it's something that we are watching closely, and we will have our action plan oriented to it as well.

Speaker #3: Right. And apart from these strategies, do you also believe that technological progress and the model that we have would be a key enabler to protect your market share in these segments, and what is your outlook on the same?

Aditya Chheda: Right. Apart from these strategies, do you also believe that the technological progress and the moat that we have could be a key enabler to protect your market share in these segments and your outlook on the same? Thanks.

Speaker #3: Thanks.

Speaker #2: Right, absolutely. I think we rely on two big pillars: nobody understands the commodity market risk like we do. I think, be it good delivery standards, be it the inventories we hold in our warehouses, or the hard work that has gone into creating these delivery-based contracts—which gives a high level of integrity to price discovery with a derivative contract merging with a physical contract, creating that price that the market accepts.

Praveena Rai: Absolutely. I think we rely on two big pillars. Nobody understands the commodity market risk like we do. I think be it good delivery standards, be it inventories we hold in our warehouses, the hard work that has gone into creating these delivery-based contracts, which gives a high level of integrity to price discovery with a derivative contract merging with a physical contract, creating a price that market accepts as being true and of high integrity. I think these are all our moats in addition to our very strong moat on technology.

Speaker #2: ...as being true and of high integrity. So, I think these are all modes, in addition to our very strong mode on technology.

Speaker #5: Thank you. Mr. Cheda, please rejoin the queue for more questions. The next question comes from the line of Aditya Yadav, with Plants in Capital. Please go ahead.

Operator 2: Thank you. Mr. Chheda, please rejoin the queue for more questions. Next question comes from the line of Aditya Yadav with Planson Capital. Please go ahead.

Speaker #3: Yeah. Hi, good evening. Thank you for the opportunity. My first question is around the reports from two or three months back that SEBI would revise the dedicated Commodity Derivatives Department.

Aditya Yadav: Hi, good evening. Thank you for the opportunity. My question, first one was around There were reports a few months back that SEBI would revive the dedicated commodity derivatives department, and that would be done in a very short period. Can you provide updates on that, whether that has happened or it's very imminent, and how does that impact our engagement cadence with SEBI and with certain things we have open on our end, like FPI, position limits, co-location, et cetera?

Speaker #3: And that would be done in a very short period. So, can you just give—can you provide updates on that? Whether that has happened or if it's very imminent?

Speaker #3: And how does that impact our engagement cadence with SEBI and with certain things we have opened on our end, like FPI position limits, co-location, etc.?

Speaker #2: So, there is a strong focus at SEBI. There are independent teams within MRD at a reasonably senior level that now work on the commodity segment.

Praveena Rai: There is a strong focus at SEBI. There are independent teams within MRD at reasonably senior levels that now work on the commodity segment. I think your understanding is correct there. The rest follows, I guess.

Speaker #2: So I think your understanding is correct there, and the rest follows, I guess.

Speaker #3: And any timelines for the open parts we have on our end? These topics we have right now—any timelines on that front?

Aditya Yadav: Any timelines for the open parts we have on our end, these topics we have right now, any timelines on that front?

Speaker #2: We can't comment on that, no.

Praveena Rai: We can't comment on that.

Speaker #5: Thank you.

Aditya Yadav: Thank you.

Praveena Rai: We are working with a lot of focus to get things over the line.

Speaker #2: We are working with a lot of focus to get things over the line.

Speaker #5: Thank you. Mr. Yadav, please rejoin the queue for more questions. The next question comes from Adarsh Singh, with Ask Private Wealth. Please go ahead.

Operator 2: Thank you. Mr. Yadav, please rejoin the queue for more questions. Next question comes from the line of Adarsh Singh with ASK Private Wealth. Please go ahead.

Speaker #3: Yes. Yeah. So, another question from my side. In this quarter, we had three months of high-tech group rather than higher volatility.

Adarsh Singh: Yes. Another question from my side. If you see basically this quarter, we had 3 months of heightened crude prices and higher volatility. If I see as compared to Q4, we only have a marginal or slight increase, actually a decrease in the quantity of crude oil options quantity. What is the reason for that?

Speaker #3: But if I see, as compared to the fourth quarter, we only have a marginal or a slight increase—or I mean, actually a decrease—in the quantity of crude oil options.

Speaker #3: So, why is that? What is the reason for that?

Speaker #2: So your question is, has the volume come down? Is that your question?

Praveena Rai: Your question is, has the volume come down? Is that your question?

Speaker #3: Yes. So, if you see quarter as compared to fourth quarter, this quarter, if I just see crude oil options quantity—basically, this is the volume part of it—it has basically come down or largely been flat.

Adarsh Singh: Basically, this quarter, as compared to Q4, this quarter, if I see crude oil options quantity, this is the volume part of it. It has basically come down or largely been flat. If you see this quarter had 3 months of heightened crude oil price and volatility. Why has not the quantity gone up or the trading in options gone up significantly?

Speaker #3: Because if you see, this contract has had three months of high-tech crude oil price and volatility. So why hasn't the quantity gone up or the trading in options gone up significantly?

Speaker #2: No, no, you're right. You're right. The numbers are flat, and the numbers are flat. And I think that's in line with what we discussed earlier—that the last quarter was a high-tech sort of one-off.

Praveena Rai: No, you're right. The numbers are flat, and I think that's in line with what we discussed earlier, that the last quarter was a heightened sort of one-off. If we look at the core trend line per se, I think this quarter actually continues to be quite healthy.

Speaker #2: And if we look at the core trend line per se, I think this quarter actually continues to be quite healthy.

Speaker #3: But my question was: basically, in the last quarter, there was probably only one month of high volatility, but this quarter, there were three months.

Adarsh Singh: My question was basically, last quarter there was only one month probably of high volatility, but this quarter it was three months. Why did we not see the same significant increase in volumes this quarter?

Speaker #3: So, why didn't we see the same significant increase in volumes this quarter?

Speaker #2: Yeah, so I think we don't want to discuss all the drivers to the geopolitical trends, no. So, over a shorter period of time, I think a lot more volatility was seen in the MRD segment.

Praveena Rai: Yeah. I think we don't want to discuss all the drivers to the geopolitical trends. Over a shorter period of time, I think a lot more volatility was seen in the energy segment.

Speaker #3: Yeah, the market went down a little slower. Significant role, because the volatility will be totally market-driven. So that will have an impact on that, which can also be attributed to the volume changes.

Praveen DG: The market plays a significant role because the volatility will be totally the market driven. That will have an impact on that can also can be attributed to the volume changes.

Speaker #5: Thank you. Mr. Singh, please rejoin the queue for more questions. The last question comes from Shravan Kumar, an individual investor. Please go ahead.

Operator 2: Thank you. Mr. Singh, please rejoin the queue for more questions. The last question comes from the line of Shravan Kumar, an individual investor. Please go ahead.

Speaker #3: Hello, can you hear me? Hello.

Shravan Kumar: Hello, can you hear me?

Speaker #5: Mr. Kumar, we cannot hear you. Can you speak a little louder?

Operator 2: Mr. Kumar, we cannot hear you. Can you speak a little louder?

Speaker #3: Hello. Can you hear me?

Shravan Kumar: Hello, can you hear me?

Speaker #5: Yes. Please go ahead.

Operator 2: Yes. Please go ahead.

Speaker #3: Hi. Thank you for the opportunity. In extension to that revenue dip from the exceptional quarter of Q4 last year, we have pretty much normalized now.

Shravan Kumar: Hi. Thank you for the opportunity. In extension to that revenue dip from the exceptional quarter of Q4 last year, we have pretty much normalized now. I want to know, as we are running on the high base from FY26, do we expect any smoothing of growth going forward into FY27?

Speaker #3: But I want to know, as we are running on a high base from FY26, do we expect any smoothing of growth going forward into FY27?

Praveena Rai: Thanks, Shravan Kumar. I think last time we couldn't hear you, thanks for coming back on. We are expecting the growth momentum at the fundamental level to continue to be good While the exceptional quarter on Q4 driven by many other factors holds the last year's numbers. We expect the numbers this year to be on a stronger momentum as well.

Speaker #2: We are expecting. Thanks, Shravan Kumar. I think last time we couldn't hear you, so thanks for coming back on. We are expecting the growth momentum at the fundamental level to continue to be good.

Speaker #2: While the exceptional quarter in Q4, driven by many other factors, held last year's numbers, we expect the numbers this year to have strong momentum as well.

Speaker #3: All right, just one more question. There is a price softness or lesser volatility in the bullion, especially gold and silver, in the month of June after the peace talks and all, between the geopolitical environment.

Shravan Kumar: All right. Just one more question. There is price softness or lesser volatility in the bullion, especially gold and silver, in the month of June after the peace talks and all between the geopolitical environment. Did you see any softness in the volumes in the bullion in the June month or in subsequent July month?

Speaker #3: So, did you see any softness in the volumes in bullion in the month of June or in the subsequent month of July?

Praveena Rai: Now, of course, we are covering our Q1 numbers here. The numbers on bullion are softer. We spoke a lot about it in the previous questions also. The silver 100 gram launch has been accepted and received very well in the market. Reflecting a kind of a product that has more affordability for hedging across the industry as well as investors. In fact, even in gold, we do find a lot of innovation in the smaller contracts like the 10-gram contract, et cetera. A lot of retail interest also being generated by sort of a home delivery model that has been introduced by some of the players on the back of the futures contracts. If somebody wants to take delivery, they are actually able to get it at home and don't have the complication of a warehouse.

Speaker #2: So, of course, we are covering our Q1 numbers here. The numbers on bullion are softer. We spoke a lot about it in the previous questions also.

Speaker #2: The silver 100-gram launch has been accepted and received very well in the market, so it's reflecting a kind of product that has more affordability for hedging across the industry as well as for investors.

Speaker #2: In fact, even in gold, we do find a lot of innovation in the smaller contracts, like the 10-gram contract, etc. A lot of retail interest is also being generated by a sort of home delivery model that has been introduced by some of the players.

Speaker #2: On the back of the futures contracts, so if somebody wants to take delivery, they are actually able to get it at home and don't have the complication of a warehouse.

Speaker #2: So many of these things are playing out, even though the larger essence of the market is lower volatility this quarter as compared to the previous quarter.

Praveena Rai: Many of these things are playing out, even though the larger essence of the market has lower volatility this quarter as compared to the previous quarter.

Speaker #5: Thank you. Ladies and gentlemen, that was the last question for today. We have reached the end of the question-and-answer session. I now hand the conference over to Mr. Praveen Narai, MD and CEO, MCX, for closing comments.

Operator 2: Thank you. Ladies and gentlemen, that was the last question for today. We have reached the end of question and answer session. I now hand the conference over to Ms. Praveena Rai, MD and CEO, MCX for closing comments.

Speaker #2: Thank you to everybody. It was a very, very meaningful discussion. We appreciate the questions and the discussion. It gives us a lot to think about, even as we answer with the knowledge, analysis, and plans that we have in mind.

Praveena Rai: Thank you to everybody. It was a very meaningful discussion. We appreciate the questions and the discussion. It gives us a lot of food for thought even as we answer this with the knowledge and analysis and plans that we have in mind. It also helps to trigger us for what we need to focus on and what we need to do next. Appreciate everybody taking your time. All the analysts and individual investors on the call. Thanks for the organizers for putting this together.

Speaker #2: It also helps to trigger us for what we need to focus on, and what we need to do next. Appreciate everybody taking your time.

Speaker #2: All the analysts and individual investors on the call, and thanks to the organizers for putting this together.

Speaker #5: Thank you. On behalf of Multi Commodity Exchange of India Limited, that concludes this conference. Thank you for joining us. You may now disconnect your line.

Operator 2: Thank you. On behalf of Multi Commodity Exchange of India Limited, that concludes this conference. Thank you for joining us. You may now disconnect your line.

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