Shares of the Multi Commodity Exchange has been hitting the upper circuit of five per cent in the last four trading sessions despite the crisis faced within the group companies.
The exchange has sought investor approval for hiking the foreign institutional investor holding to 49 per cent from 23 per cent.
Norm relaxation
It intends to make a sub-limit of 23 per cent interchangeable with 26 per cent foreign direct investment for secondary market compliance under the portfolio investment scheme, such that individual holding of an FII shall not exceed five per cent of the paid-up capital of the company, it added.
These moves assume significance, as recently the Government relaxed norms for foreign direct investment in commodity exchanges. Accordingly, commodity exchanges need not seek Government approval for up to 49 per cent ownership by foreign investors.
The exchange will seek shareholder approval at the Annual General Meeting to be held on September 30.
On Wednesday, the MCX stock was up five per cent at Rs 432 on the BSE. In fact, the shares have gained 55 per cent from Rs 278 on August 22 to the current level, even as the overall market has been riding topsy-turvy. Vikram Dhawan, Director, Equentis Capital, said prospects of the exchange being taken over by the Government or a financial institution have been steadily driving up the stock prices.
“MCX can be a game changer if the takeover plans come true. As it is, the exchange is a market leader in industrial and precious metals,” he said.
Shares of Financial Technologies, the holding company of MCX, were up 0.71 per cent at Rs 113. These shares were crashed sharply following the settlement problem at the National Spot Exchange Ltd, another group company.
NSEL has failed to meet its payout obligations in the last three settlements. The exchange shut trading on its platform on August 1 and charted out a settlement plan for investors who have an exposure of Rs 5,600 crore.
The crisis deepened after it was found that the stocks claimed to be in the possession of the exchange went missing from the warehouses. An independent audit firm has declared that it has found only 15 per cent of the goods declared by the exchange in the warehouses.
Meanwhile, the National Stock Exchange offloaded over two per cent stake in MCX in small patches last month. Of the 12.5 lakh shares held by NSE, it sold off about 12 lakh shares. It was holding 2.45 per cent in the exchange.
LIKELY DIVIDEND
The exchange has sought shareholder approval to consider interim and final dividends for the last financial year at the AGM to be held on September 30. The payment of final dividend will be made on or after October 7, said MCX.