New Delhi: The country’s top commodity exchange, Multi Commodity Exchange of India Ltd (MCX), may consider delaying its initial public offer (IPO) because of introduction of the commodities transaction tax (CTT), which is likely to affect the turnover of the bourse.
“It will require a deliberation in the company,” a source said, commenting on whether MCX would shelve or delay its IPO due to the negative market sentiment created by the introduction of CTT.
CTT would affect the business of the commodity market, the source added. The turnover at MCX, which has a stronghold in bullion, metal and energy commodities, was Rs27.3 trillion during April-December.
MCX had last month filed a draft prospectus with market regulator Securities and Exchange Board of India for its IPO to raise about Rs500 crore from sale of 10 million equity shares.
NYSE Euronext had picked 5% in MCX for $55 million last month. That deal had valued MCX at about $1.1 billion (Rs4,433 crore).
According to the prospectus, the public issue of 10 million equity shares of Rs5 each at a premium to be determined through a 100% book-building process would comprise fresh issue of 6 million shares. Another 4 million shares will be sold by Financial Technologies (India) Ltd, the main promoter of MCX, and Corporation Bank.
The firm had filed a draft red herring prospectus for its IPO way back in 2006, but the plans were later shelved.
Proceeds of the issue would be used for the exchange’s tec-hnology infrastructure and str-ategic investment and acquisitions, besides other usages.
MCX intends to use Rs135.1 crore for expansion and enhancement of technology infrastructure, about Rs50 crore to set up a commodity ecosystem infrastructure, Rs100 crore in equity investment in a clearing corporation promoted by MCX and Rs25 crore for strategic investments and acquisitions.