IEX share price tanks 4% to near 52-week low. What's behind the fall? Explained

Shares of Indian Energy Exchange (IEX) slumped 4% in Friday's trading session (December 26) amid reports of a revision in transaction fees charged by the power exchanges in India.

IEX share price declined as much as 4% to ₹133.45, nearing its 52-week low of ₹130.35. The stock has lost 28% over the past six months and 24% on a year-to-date (YTD) basis.

CERC looks to revise transaction fee

An Economic Times report, citing sources, states that the CERC is considering a lower, uniform fee of around 1.5 paise per kilowatt-hour (kWh) per side across most trading segments.

Currently, exchanges charge a fee of 2 paise per kWh on both the buying and selling sides, resulting in a total fee of approximately 4 paise per kWh.

Another suggestion involves lowering the transaction fee of 1.25 paise/unit for term-ahead market (TAM) contracts due to the longer nature of such contracts.

Mint, however, could not independently verify the report.

According to the report, IEX has little incentive to reduce fee under the current structure, while other exchanges have little financial headroom to undercut pricing.

What could be the impact of this move on IEX?

Harshal Dasani, Business Head at INVAsset PMS, said that the regulator is evaluating a lower fixed fee structure to improve transparency and reduce costs for market participants — a move that could directly impact exchange-level profitability.

For IEX, transaction fees form a meaningful portion of revenues, and any downward revision could lead to margin compression, particularly in the short term. “While volumes on the exchange remain structurally strong, the market is factoring in the risk of reduced pricing power as regulatory oversight intensifies. The proposed changes also come at a time when market coupling is expected to be implemented over the medium term, which could further normalise fee structures across exchanges,” he added.

In the near term, he expects earnings sensitivity to fee revisions is likely to remain a key overhang for IEX.

As of 10.20 am, IEX share price traded at ₹136.05, down 2.23% on the BSE.

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