Shares of Indian Energy Exchange (IEX) hit a 52-week low of Rs 116, freezing 15% lower on the National Stock Exchange (NSE) in Friday’s intraday trade, following reports that the Power Ministry had the Central Regulatory Commission (CERC) implemented the market coupling process promptly.

Shares of the country’s main energy exchange have fallen 22% over the past two sessions. Over the past week, it has fallen 24%, while the Nifty 50 gained 0.8%. The stock fell below the previous low of Rs 125.75 on March 29, 2023.

A total of 12 million shares changed hands on the NSE and BSE as of 9:33 am. The stock trades in the futures and options (F&O) segment, so there are no circuit restrictions.

Market coupling refers to forming a single government-owned electricity trading entity where prices will occur, and electricity will be dispatched to short-term electricity trading platforms.

IEX is the market leader with the highest trading volume in electricity trading. ICICI Securities said in a report that this would significantly reduce the trading volume on IEX and other power trading platforms and take away IEX’s moat for liquidity creation and price discovery.

IEX is India’s premier energy exchange, providing a nationwide automated trading platform for the physical delivery of electricity, renewable energy and certificates, including renewable energy certificates and energy conservation certificates. The trading platform enables efficient price discovery, increasing accessibility and transparency in India’s energy markets while increasing the speed and efficiency of trade execution.

Meanwhile, total trade volume on Indian energy exchanges rose 8% year-on-year to 8,251 billion units (MU) in May, IEX said on Monday.

The average spot electricity price in May 2023 was 30% lower at Rs 4.74 per unit from Rs 6.76 per unit in May 2022 due to improved supply-side conditions leading to increased liquidity and cooler weather conditions.

While electricity demand is expected to increase in the coming months, supply-side liquidity is likely to improve further due to increased coal supply, lower coal prices in electronic auctions and continued declines in imported coal and natural gas prices, IEX said.