The National Commodity & Derivatives Exchange (NCDEX) plans to launch equity derivatives in the next 12 months in a bid to diversify beyond its core agricultural commodities business, said an official familiar with the matter. The exchange also looks to launch equity cash segment trading by this year end.
“NCDEX is planning to launch equity derivatives by June 2027. This is part of their plan to foray into segments other than agri commodities,” said the official who did not wish to be named. “The exchange will initially launch one weekly options contract and a monthly options contract.”
The move will mark one of the most ambitious expansion plans of the exchange since it began operations in 2003 after the Atal Bihari Vajpayee government lifted a four-decade ban on commodity derivatives trading. Over the years, NCDEX has built its identity around agricultural commodities, and is now trying to reposition itself in India’s much larger equity markets ecosystem.
In an emailed response to Mint's queries on the plans, NCDEX said it looks to first launch a mutual fund platform before rolling out its equity and derivatives businesses.
“Subject to regulatory approval, we plan to launch a mutual fund platform in June to expand the reach of the MF segment beyond the top 30 markets," said Arun Raste, managing director and chief executive officer at NCDEX in the email. "We have just finalized the systems, hardware, et al for the equity (cash) segment and, once we receive Sebi (Securities and Exchange Board of India) approval, we intend to launch it towards the year-end.”
“While it is early days to talk about equity derivatives, post the above two launches, and subject to regulatory approvals, we intend to enter the derivatives segment with weekly and monthly options contracts,” the email said.
The exchange has already secured regulatory clearances for its diversification plans. It recently received an in-principle approval from the markets regulator to launch a mutual fund platform. The business is expected to act as a precursor to its equity market expansion as the exchange builds distribution and transaction infrastructure outside commodities. Earlier, in July 2025, it got an in-principle nod from Sebi for the launch of equity and equity derivatives segments, an exchange filing had said. The NCDEX board had approved the equity market foray in February last year.
The launch is now subject to fulfilment of conditions laid down by the regulator.
“They will enter the UAT (user acceptance testing) phase for equities (cash) by September. NCDEX is also awaiting Sebi’s final nod, which is expected to come this year,” said the official mentioned above.
To finance the new platforms and related services, NCDEX raised ₹770 crore through a preferential allotment of shares to 61 investors in September 2025. Investors included Kotak Life Insurance, JM Financial, high net worth individuals such as Madhu Kela and Ramesh Damani, stockbrokers including Share India and Globe, and foreign high-frequency traders such as Optiver and Citadel Securities, according to a company press release.
An emailed query to Sebi on NCDEX’s launch timeline for equity derivatives did not elicit a response until press time.
NCDEX’s planned entry into equity derivatives pits it against the National Stock Exchange (NSE) and the BSE, the only two major players in the segment.
The exchange may have to wisely choose its expiry day, which is now restricted to two days a week. Sebi had restricted expiries of all equity derivatives contracts of an exchange to Tuesday or Thursday in a bid to curb excessive speculation on expiry days. Currently, NSE’s derivatives contracts expire on Tuesdays, while BSE’s expire on Thursdays. Any new entrant would effectively be forced to take on one of the two established exchanges head-on to win market share.
NSE had a total premium turnover of ₹142.42 trillion in FY26, while BSE was at ₹48.22 trillion in the same period, according to Sebi data. Currently, NCDEX dominates the agri-commodities trading, with a futures turnover of ₹1.4 trillion in FY26 and total options premium turnover of ₹209 crore.
“For launching any derivative, they need an underlying. They will have to launch equity, and build it first to launch derivatives. There are a few opportunities right now such as NSE listing that they may be seeing,” said Narinder Wadhwa, managing director at SKI Capital Services.
“They can choose either Tuesday or Thursday (for expiry). Product differentiation can help them to attract eyeballs depending on what their cash segment looks like," Wadhwa added. "NCDEX can create different indices and then launch derivatives on those indices.”
MSEI in the fray too
NCDEX’s diversification plan comes as the Metropolitan Stock Exchange of India (MSEI), earlier known as MCX-SX, attempts to strengthen its equity market presence. It recently announced the appointment of market makers for its equity segment, and had said it would introduce liquidity enhancement measures from April 2026 to deepen market participation.
MSEI already has Sebi recognition to operate in equity cash, equity derivatives, currency derivatives and debt segments. However, every exchange requires a separate ‘segment’ approval from Sebi to offer products to investors and traders.
MSEI currently operates in currency derivatives and maintains a small equity cash segment. Average daily turnover for MSEI’s equity cash segment was about ₹40 lakhs compared to NSE’s ₹1.06 trillion, according to Sebi data.
In May 2025, Mint reported that Sebi rules governing weekly expiries have derailed MSEI’s plans to launch equity derivatives, as it would have to compete with NSE and BSE on expiry day for market share. The exchange had raised ₹238 crore from broking firm Groww’s parent Billionbrains Garage Ventures, Zerodha's Rainmatter Investments, Share India Securities, and Securocorp Securities India in December 2024.
The bourse planned to offer a derivative contract for its flagship equity index SX40. MSEI had set Friday expiry for its SX40 contracts.