Board to decide if FT can subscribe to rights issue: MCX-SX

The board of MCX -SX would decide whether it would allow Financial Technologies to subscribe to its rights issue, MCX Vice Chairman Thomas Matthew said.

MCX-SX, India's third national stock exchange run by MCX , is looking to raise Rs 500-600 crore via the rights issue, Matthew told CNBC-TV18.

Financial Technologies , the anchor investor of MCX, is under fire for Rs 5,500 crore payment default at its subsidiary National Spot Exchange.

Also Read: Blackstone ups stake in MCX, buys shares worth Rs 81 cr

In the wake of the scandal, commodity derivatives regulator Forward Markets Commission has ordered FT to cut its stake in MCX while markets regulator Securities and Exchange Board of India has been reportedly mulling a similar decision with regards to MCX-SX.

The stock exchange is owned about 90 percent by public sector banks and financial institutions, Thomas, however, said.

Below is the verbatim transcript of Thomas Matthew's interview on CNBC-TV18

Q: In the continued effort to understand MCX and MCX-SX, can you enlighten us about how Financial Technologies (FT) warrants are likely to be treated? Do you have any clarity that they will have to sell it off to other parties and will not be able to exercise it as shares themselves?

A: The MCX-SX stock exchange is totally ring-fenced. The regulator has put public interest directors (PIDs) and there is a new board looking at the whole thing and so many steps are being taken to ensure the confidence of the public and the market, the confidence of traders and brokers and of our employees, all the stake holders are restored. For this, the board has started many initiatives and we are hopeful that in the coming days, MCX-SX will be able to show a good picture.

Q: Can you give us some clarity on whether MCX and FTIL are considered as common promoter entities or as independent entities?

A: The stake of MCX-SX mainly is held by the public sector banks. There are 16 public sector banks holding 66 percent of the total MCX-SX stake. There are also leading private banks and financial institutions holding stake in MCX-SX. The stake held by MCX and FTIL is only 5 percent each. That means 90 percent of the MCX-SX is held by the public sector banks and other leading private and public institutions.

MCX India stock price

On January 07, 2014, at 11:10 hrs Multi Commodity Exchange of India was quoting at Rs 587.45, up Rs 16.00, or 2.80 percent. The 52-week high of the share was Rs 1458.25 and the 52-week low was Rs 238.30.

The company's trailing 12-month (TTM) EPS was at Rs 47.00 per share as per the quarter ended September 2013. The stock's price-to-earnings (P/E) ratio was 12.5. The latest book value of the company is Rs 226.82 per share. At current value, the price-to-book value of the company is 2.59.

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