IEX Share Price Crash: The shares of the Indian Energy Exchange (IEX) declined on July 24 today. As soon as the stock market opened, the price of shares of this government company fell 15% to its lower circuit limit. The only biggest reason for this decline was the announcement of market council rules. The Central Electricity Regulatory Commission (CERC) has approved the implementation of market coupling rules from January 2026. This rule is being considered a major setback for IEX’s business model, due to which it was competing to sell its shares today. What is this rule of marketing coupling? How can IEX suffer damage by the implementation of this rule? Let us understand it in detail.
1. Why the rules of market coupling are being implemented?
There are currently three main power exchanges in India. Apart from IEX, there are Power Exchange India Limited (PXIL) and Hindustan Power Exchange Limited (HPX). Just as shares are purchased and sold on stock actors, so power exchanges are purchased and sold. But as you have seen that there is some difference in the price of the same share on stock exchanges. BSE and NSE have two expressions of the same share and there is a difference of some money. Similarly, power exchanges also occur. That is, the cost of electricity on every power exchange is a little right but different. But to overcome this problem, the government is considering implementing market coupling.
2. What is market coupling?
Market compiling is a model, under which the upcoming dialects of Buy and SELL are collected by collecting a place on all power exchanges and then a similar market clearing price (MCP) is fixed on the basis of it. This will have the same price of electricity at all power exchanges at one time.
3. Why can IEX suffer losses with this rule?
IEX i.e. Indian Energy Exchange is the largest power exchange in the country. Currently, about 90% of the electricity trading is from the platform of IEX. Trading on the second exchange is negligible. But after the arrival of market coupling, there will be a price of another exchange everywhere. The new power exchange will also create an opportunity to open. In such a situation, the monopoly of the company will be reduced. Also, its trading volumes and revenue are also expected to decline, which is harassing its investors. That is why there is pressure on the stock.
4. What will the government benefit from this rule?
The government also wants to implement market coupling because it wants to reduce the trend of long -term current power procurement agreement (PPA), which usually lasts up to 25 years. The government hopes that this rule will increase electricity purchases on exchanges. Also, the transmission line will be used better. From the perspective of a consumer, the rules of market coupling will transparency in electricity prices and can reduce tariffs in a long time.
5. What is the experts to say?
Brokerage firm Elar Securities said in a report released some time ago that with the implementation of market coupling, IEX’s market share could fall from 84 per cent to 70 per cent by FY 2027. IIFL also believes that the market coupling may shock IEX and its EPS (per share income) may fall by 25 per cent in FY 2026.
According to domestic brokerage firm Motilal Oswal, the implementation of market coupling may show pressure on IEX shares. Since its market share is the highest, the implementation of market coupling will show the impact of the growth of the company. Overall, almost all experts seem unanimous on the fact that this rule may cause IEX’s market share to decline.
6. Share performance
Around 10.30 am, IEX shares were down 15 per cent to lock their lower circuit limits at a price of Rs 159.70. So far this year, the company’s shares have fallen by about 12 per cent. At the same time, its current market cap is about Rs 14,200 crore. Currently, the company’s shares are trading very close to their 52-wheew of Rs 151.
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