Synopsis:
Shares fell nearly 20% after the regulator approved market coupling norms, sparking concerns over rising competition and loss of pricing advantage. A global brokerage cut its price target, citing regulatory overhang and risks to institutional investor interest despite strong financial performance.
India’s Exchange and Data Platform sector is experiencing dynamic growth, propelled by technology and digitalization. As of February 2025, the country’s market capitalization was approximately $4.39 trillion. The data marketplace platform market was valued at $51.7 million in 2024 and is forecast to grow at a 34% CAGR from 2025 to 2030, indicating strong expansion.
With a market capitalization of Rs 13,402.14 crore, the shares of Indian Energy Exchange Ltd were trading at Rs 150.30 per share, decreasing around 20 percent as compared to the previous closing price of Rs 187.85 apiece.
Bernstein, one of the well-known brokerages globally, has retained its ‘market-perform’ rating and cut its price target for this stock from Rs 160 to Rs 122 apiece, indicating a potential downside of 35 percent from the previous closing price of Rs 187 per share.
CERC has approved Market Coupling norms for the Day-Ahead Market (DAM), set for implementation by January 2026. Power exchanges will rotate as Market Coupling Operators to ensure uniform price discovery. Grid India will act as a backup operator, develop software for Term-Ahead coupling, and conduct a three-month pilot.
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The implementation of market coupling, despite Grid-India’s opposing report, is seen as a negative for IEX, potentially eroding its price discovery advantage. With IEX currently holding an 85% spot market share, coupling may shift volumes toward rival exchanges, increasing competition and impacting its dominant position.
Bernstein noted that the CERC order on market coupling is more adverse than expected, intensifying regulatory overhang and making IEX less attractive for institutional investors. While earlier the brokerage saw only a 50% chance of coupling, it is now confirmed from January 2026. Increased competition may also lead to a quicker reduction in transaction charges.
Looking forward to the company’s financial performance, revenue increased by 17 percent from Rs 121 crore in Q4FY24 to Rs 142 crore in Q4FY25. Further, during the same time frame, net profit increased by 21 percent from Rs 97 crore to Rs 117 crore.
Indian Energy Exchange (IEX) operates a nationwide, CERC-regulated platform for electricity and renewable trading. With over 8,500 participants and a 30% volume CAGR since 2008, it reported 84.2% market share in FY25. Electricity volumes rose 18.7% YoY, and renewable certificate trading surged 136%, highlighting strong growth and ecosystem expansion.
Indian Energy Exchange Limited is an India-based company that is engaged in providing an automated trading platform for the physical delivery of electricity, renewables, and certificates. It offers various trade markets, such as the electricity market, green market, and certificates.
Written by Abhishek Singh
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