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Economic Times
2 days ago
- Business
- Economic Times
IEX shares slide 9% as market coupling fears continue to drag, brokerages cut targets
Shares of Indian Energy Exchange (IEX) fell as much as 8.9% on Monday, July 28, to Rs 132.15 on BSE, as renewed selling pressure weighed on the stock amid persistent concerns over market coupling — a regulatory shift that threatens the company's dominance in power trading. ADVERTISEMENT The decline comes after IEX shares rebounded 13% on Friday, following the release of strong Q1 FY26 results. That rally offered temporary respite to investors after the stock's record single-day plunge of nearly 30% on Thursday, when the Central Electricity Regulatory Commission (CERC) approved market coupling – a move widely viewed as a structural threat to the company's business model. On Thursday, the sell-off triggered massive trading volumes, with 12.77 crore shares worth Rs 1,740 crore changing hands, surpassing the combined volumes of all 16 earlier trading sessions in July. Over 43.75% of the shares traded on the NSE were marked for delivery, indicating a sharp churn in investor positions. Brokerages have flagged the CERC's order as a significant threat to IEX's pricing power and market said the regulation 'disrupts IEX's monopoly in the DAM market by introducing uniform price discovery across exchanges. This levels the playing field, impacting IEX's moat of price determination.' ADVERTISEMENT The brokerage expects IEX's share in the DAM and RTM segments (currently 99% of FY25 volumes and 80–85% of sales) to fall to 70% by FY27. 'A price war-led trading margin cut is likely, from 4p/kWh to 3.5p/kWh by FY28E,' Nuvama said, retaining a 'reduce' rating with a target price of Rs 133, down from Rs said that market coupling will accelerate IEX's market share losses, projecting a decline from over 80% in FY25 to 50% by FY28. 'The market coupling threat has become a reality… The regulation has taken away [IEX's liquidity advantage] as all power exchanges will have a uniform clearing price,' it said. Jefferies cut its price target to Rs 105 from Rs 150 and maintained an 'underperform' rating. ADVERTISEMENT Elara Capital also flagged 'significant pressure on IEX,' noting that CERC has approved phased implementation of market coupling, starting with the day-ahead market (DAM) by January 2026. 'This poses a major threat to Indian Energy Exchange's dominance, as market coupling could shift volume to rival exchanges,' it said, adding that IEX could be forced to lower trading margins to retain market Q1 FY26 performance briefly supported the stock last week. The company reported a 25% year-on-year (YoY) rise in consolidated net profit to Rs 120 crore, compared to Rs 96 crore a year earlier. Revenue climbed 19% YoY to Rs 184.2 crore, driven by robust trading activity. Electricity volumes rose 14.9% YoY to 32.4 billion units, while Renewable Energy Certificates (RECs) surged 149.3% YoY to 52.7 lakh units. ADVERTISEMENT 'The company is currently undertaking a detailed impact assessment of the implications of [market coupling] and will keep stakeholders informed of any further developments,' IEX said in its post-results analysts caution that earnings momentum could soften as regulatory reforms reshape market dynamics. 'With the core business model under pressure and limited clarity on long-term profitability, markets have rightly reacted. For IEX, the days of monopoly-like pricing power may now be history,' said Harshal Dasani, Business Head at INVasset PMS. Also read | Understand 'Market Coupling Approved' before reacting to IEX stock price movement and making any decision (Disclaimer: Recommendations, suggestions, views, and opinions given by the experts are their own. These do not represent the views of The Economic Times) (You can now subscribe to our ETMarkets WhatsApp channel)
Time of India
2 days ago
- Business
- Time of India
IEX shares slide 9% as market coupling fears continue to drag, brokerages cut targets
Brokerages warn of market share erosion Live Events Strong earnings overshadowed (You can now subscribe to our (You can now subscribe to our ETMarkets WhatsApp channel Shares of Indian Energy Exchange (IEX) fell as much as 8.9% on Monday, July 28, to Rs 132.15 on BSE, as renewed selling pressure weighed on the stock amid persistent concerns over market coupling — a regulatory shift that threatens the company's dominance in power decline comes after IEX shares rebounded 13% on Friday, following the release of strong Q1 FY26 results. That rally offered temporary respite to investors after the stock's record single-day plunge of nearly 30% on Thursday, when the Central Electricity Regulatory Commission (CERC) approved market coupling – a move widely viewed as a structural threat to the company's business Thursday, the sell-off triggered massive trading volumes, with 12.77 crore shares worth Rs 1,740 crore changing hands, surpassing the combined volumes of all 16 earlier trading sessions in July. Over 43.75% of the shares traded on the NSE were marked for delivery, indicating a sharp churn in investor have flagged the CERC's order as a significant threat to IEX's pricing power and market said the regulation 'disrupts IEX's monopoly in the DAM market by introducing uniform price discovery across exchanges. This levels the playing field, impacting IEX's moat of price determination.'The brokerage expects IEX's share in the DAM and RTM segments (currently 99% of FY25 volumes and 80–85% of sales) to fall to 70% by FY27. 'A price war-led trading margin cut is likely, from 4p/kWh to 3.5p/kWh by FY28E,' Nuvama said, retaining a 'reduce' rating with a target price of Rs 133, down from Rs said that market coupling will accelerate IEX's market share losses, projecting a decline from over 80% in FY25 to 50% by FY28. 'The market coupling threat has become a reality… The regulation has taken away [IEX's liquidity advantage] as all power exchanges will have a uniform clearing price,' it said. Jefferies cut its price target to Rs 105 from Rs 150 and maintained an 'underperform' Capital also flagged 'significant pressure on IEX,' noting that CERC has approved phased implementation of market coupling, starting with the day-ahead market (DAM) by January 2026. 'This poses a major threat to Indian Energy Exchange's dominance, as market coupling could shift volume to rival exchanges,' it said, adding that IEX could be forced to lower trading margins to retain market Q1 FY26 performance briefly supported the stock last week. The company reported a 25% year-on-year (YoY) rise in consolidated net profit to Rs 120 crore, compared to Rs 96 crore a year earlier. Revenue climbed 19% YoY to Rs 184.2 crore, driven by robust trading activity. Electricity volumes rose 14.9% YoY to 32.4 billion units, while Renewable Energy Certificates (RECs) surged 149.3% YoY to 52.7 lakh units.'The company is currently undertaking a detailed impact assessment of the implications of [market coupling] and will keep stakeholders informed of any further developments,' IEX said in its post-results analysts caution that earnings momentum could soften as regulatory reforms reshape market dynamics. 'With the core business model under pressure and limited clarity on long-term profitability, markets have rightly reacted. For IEX, the days of monopoly-like pricing power may now be history,' said Harshal Dasani, Business Head at INVasset PMS.
Time of India
5 days ago
- Business
- Time of India
IEX shares rebound 13% after record plunge; stock stays in F&O ban. What should investors do?
Q1 results offer relief Live Events Market dominance under scrutiny F&O ban limits trading (You can now subscribe to our (You can now subscribe to our ETMarkets WhatsApp channel Shares of Indian Energy Exchange (IEX) rebounded sharply on Friday, July 25, surging as much as 12.8% to Rs 149.45 on the BSE, a day after suffering their steepest single-day decline on record. The stock remains under the Futures and Options (F&O) ban even as strong quarterly earnings offered some respite to Thursday, July 24, IEX shares plunged nearly 30% to a 52-week low after the Central Electricity Regulatory Commission (CERC) approved market coupling , a regulatory change that has long been viewed as a structural threat to the company's dominance in power sell-off triggered massive trading volumes, with 12.77 crore shares worth Rs 1,740 crore changing hands, surpassing the combined volumes of all 16 previous trading sessions in July. Over 43.75% of the shares traded on the NSE were marked for delivery, indicating heavy investor activity had intensified in the days leading up to the announcement. Volumes over the three sessions prior to Thursday stood at 78 lakh, 97 lakh and 92 lakh, compared to a 10-day average of 61 rebound on Friday followed the company's Q1FY26 results , released after market hours on Thursday. IEX reported a 25% year-on-year (YoY) increase in consolidated net profit to Rs 120 crore, compared to Rs 96 crore a year earlier. Revenue for the quarter climbed 19% YoY to Rs 184.2 crore, driven by robust trading volumes on the exchange rose 14.9% YoY to 32.4 billion units in Q1FY26. Renewable Energy Certificates (RECs) surged 149.3% YoY to 52.7 lakh units.'The company is currently undertaking a detailed impact assessment of the implications of [market coupling] and will keep stakeholders informed of any further developments,' IEX said in its post-results commands over 90% market share in the Day-Ahead Market (DAM) and Real-Time Market (RTM), both of which are key revenue drivers. However, centralized price discovery under market coupling could erode this advantage."Market coupling has been a persistent overhang for IEX, and with CERC's recent approval for its implementation, we expect a sharp decline in the company's market share, resulting in a loss of its dominant position in the DAM and RTM segments," said Rupesh Sankhe, vice president and power sector analyst at Elara SecuritiesTo retain volume amid rising competition, IEX may be compelled to lower trading margin, further weighing on earnings, said Sankhe.'While regulators aim to improve efficiency and transparency, investors fear revenue erosion and reduced platform stickiness. With the core business model under pressure and limited clarity on long-term profitability, markets have rightly reacted. For IEX, the days of monopoly-like pricing power may now be history,' said Harshal Dasani, Business Head at INVasset, stock was placed under the F&O ban on Thursday after open interest in its derivatives contracts breached 95% of the Market-Wide Position Limit (MWPL) on the NSE. Under this framework, no new positions can be created in F&O contracts, though existing ones can be squared off. The mechanism is designed to curb speculative build-up and prevent market of the F&O ban can attract penalties under Sebi norms, ranging from 1% of the position value (minimum Rs 5,000) up to Rs 1 lakh, along with potential trading suspensions.: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of the Economic Times)
India Today
5 days ago
- Business
- India Today
IEX stock: Indian Energy Exchange shares to be in focus today. Here's why
Shares of Indian Energy Exchange (IEX) are likely to remain in focus today, a day after the company posted it's April–June quarter results and also faced a sharp fall in its stock price due to a regulatory reported a standalone net profit of Rs 113 crore for the first quarter of the financial year 2026. This is a 21% increase from Rs 93 crore reported in the same quarter last year. Revenue from operations rose 13% on-year to Rs 140 crore, up from Rs 124 crore in Q1 FY25. Expenses for the quarter also increased by 9% to Rs 32 the June quarter, IEX saw a 15% rise in electricity volumes, reporting a total of 32.4 billion units (BUs). It also recorded a 149% year-on-year jump in the trading of Renewable Energy Certificates (RECs), with volumes at 52.7 lakh company said that India's peak power demand this summer touched 242 gigawatts (GW) on June 12. Though an even higher demand of 277 GW was expected due to forecasts of an intense summer, early monsoon and unseasonal rains helped bring temperatures down, reducing the overall to the company, fuel availability remained stable and affordable. India's coal production continued without major disruption. With increased hydro and wind generation and steady coal-based supply, power supply liquidity improved on exchanges, helping keep prices the Day Ahead Market (DAM), supply liquidity grew by 45.2% on a year-on-year basis. As a result, the average price in the DAM segment dropped to Rs 4.41 per unit in Q1 FY26, down by nearly 16% from last year. Similarly, the Real-Time Market (RTM) saw an average price of Rs 3.91 per unit, marking a 20% year-on-year despite the strong operational and financial performance, IEX shares fell sharply on Thursday, July 24. The stock dropped as much as 28% and touched a 52-week low of Rs 135.26 on the BSE. This fall came after the Central Electricity Regulatory Commission (CERC) issued a formal order announcing the start of market coupling in India's power to the CERC, market coupling will be implemented in phases. The first phase, scheduled for January 2026, will involve coupling the Day-Ahead Market operated by different power exchanges using a round-robin coupling is expected to centralise the price discovery process across all exchanges, which could impact IEX's dominance in the sector. Investors reacted negatively to this announcement, as it raises concerns about future competition and pricing power for both regulatory changes and quarterly earnings now in the spotlight, the IEX stock will remain under watch in the coming days.- Ends advertisement
Time of India
5 days ago
- Business
- Time of India
IEX shares rebound 8% after worst fall, driven by upbeat Q1 earnings
Here are the details: IEX Q1 results Live Events CERC gives market coupling a go-ahead (You can now subscribe to our (You can now subscribe to our ETMarkets WhatsApp channel After their steep fall on Thursday, shares of Indian Energy Exchange IEX ) rallied 8.4% to an intraday high of Rs 143.55 in early trade on BSE on Friday, July 25. The rebound came after the power trading platform reported a strong 25% year-on-year (YoY) rise in consolidated net profit for the quarter ended June 30, Thursday, the stock had declined sharply after CERC approved the implementation of market company's net profit for Q1FY26 stood at Rs 120 crore, up from Rs 96 crore in the same period last for the quarter came in at Rs 184.2 crore, marking a 19% YoY growth compared to Rs 154 crore in earnings were announced after market hours on the operational front, electricity volumes on the exchange for Q1FY26 stood at 32.4 billion units (BUs), reflecting a 14.9% YoY growth. In addition, IEX reported that 52.7 lakh Renewable Energy Certificates (RECs) were traded during the quarter, up 149.3% YoY. IEX shares plunged 29% to settle at Rs 132.45 on the BSE following the Central Electricity Regulatory Commission's (CERC) formal approval to the implementation of market coupling for India's power an official order issued on Wednesday, the CERC stated that it has decided to initiate the process of market coupling in a phased manner. The first phase will involve the coupling of the Day-Ahead Market (DAM) operated by the country's power exchanges. This will be done using a 'round-robin' mode by January market coupling is a mechanism used in electricity markets to unify the price discovery process by pooling bids from multiple power exchanges and clearing them centrally.: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)
