Shares plunged after regulators approved market coupling norms, threatening the company’s dominant position. Despite strong revenue and profit growth, analysts foresee declining market share and returns. Increased competition and regulatory shifts pose major headwinds, though volume growth and limited rival traction could offer upside.
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 12,675.73 crore, the shares of Indian Energy Exchange Ltd were trading at Rs 141.10 per share, decreased around 9 percent as compared to the previous closing price of Rs 145.10 apiece.
Jefferies, one of the well-known brokerages globally, has maintained its ‘underperform’ rating and cut its price target for this stock from Rs 150 to Rs 105 apiece, indicating a potential downside of 26 percent from the current level of Rs 141 per share.
On Thursday, the shares of the company fell by 30% fall after CERC 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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Jefferies flagged concerns over IEX’s declining dominance, projecting its market share to drop from over 80% in FY25 to 50% by FY28 due to new market coupling norms effective January 2026. With rivals targeting aggressive growth, one eyeing a 33% share, and PXIL entering the fray, competitive pressure is set to intensify.
Jefferies sees medium-term value from IGX for IEX but expects its stake to reduce to 25%. Valuing IEX at 20x FY27 P/E well below its historical 35x reflects shifting market dynamics. RoE is forecasted to drop to 27% from the earlier 35–40%. However, stronger volumes or limited competition gains could offer upside potential.
Looking forward to the company’s financial performance, revenue increased by 15 percent from Rs 124 crore in Q1FY25 to Rs 142 crore in Q1FY26. Further, during the same time frame, net profit increased by 26 percent from Rs 96 crore to Rs 121 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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