Ladies and gentlemen, good day, and welcome to the Indian Energy Exchange Q4 FY 2026 results conference call hosted by Axis Capital Limited. As a reminder, all participant lines will be in the listen-only mode, and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during this conference call, please signal an operator by pressing star then zero on your touch-tone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Rohan Gheewala from Axis Capital Limited. Thank you, and over to you, sir.
Thank you. Good afternoon, ladies and gentlemen. On behalf of Axis Capital, I'm pleased to welcome you all to the IEX Q4 FY 2026 earnings conference call. We have with us the management team of IEX, which is represented by Mr. S N Goel, Chairman and Managing Director, Mr. Vineet Harlalka, Chief Financial Officer, Ms. Aparna Garg, Head, Investor Relations and Corporate Communications, and Mr. Aditya Wali, Investor Relations. We will begin with the opening remarks from Ms. Aparna, followed by an interactive Q&A session. Thank you, and over to you.
Hi. Good afternoon, everyone, and welcome to the IEX earnings call for the fourth quarter and full fiscal year 2026. I, Aparna Garg, will be making the opening remarks today. With me today on this call are Mr. Satyanarayan Goel, CMD, IEX; Mr. Vineet Harlalka, CFO and Company Secretary; and Mr. Aditya Wali from the Investor Relations team. Mr. Rohit Bajaj, JMD and Mr. Amit Kumar, Head of Market Operations and Exchange Technology, are not available to join us today due to other official meetings. Amid geopolitical challenges in the Middle East and heightened global uncertainty, India continues to remain the fastest-growing major economy in the world, delivering a strong GDP growth of 7.8% in the third quarter of fiscal 2026.
Based on second advanced estimates released by the National Statistical Office, India is expected to end financial year 2026 with a growth rate of 7.6%. The recent Middle East conflict has heightened risk to the growth outlook through elevated crude prices, supply disruptions, slower global growth, tighter liquidity, and spillovers into domestic credit markets. However, India's growth performance going forward will be driven by a strong domestic consumption, increased capital investment, and steady momentum across industry and services. Further reforms such as rationalization of GST rates, new labor laws, and free trade agreements with the U.K. and EU position it on track to become the world's third-largest economy.
On the power sector front, India's electricity demand at 423 billion units in quarter four FY 2026 increased moderately by 2.2% compared with Q4 FY 2025, though at 1,709 billion units, electricity consumption for FY 2026 remained almost flat. Financial year 2026 witnessed an incremental 58 GW of installed capacity across thermal and renewable sources, taking total installed capacity to 533 GW. Renewable energy accounted for more than 50% of the total installed capacity at 275 GW, making India the third largest in terms of renewable capacity globally. Notably, in FY 2026, India achieved this milestone of sourcing 50% of its cumulative installed electricity power capacity from renewable sources five years ahead of the 2030 target. On the fuel side, ample fuel was available at competitive prices.
India's coal production reached 322 million tons in Q4 FY 2026, and in FY 2026, India's coal production recorded 1,041 million tons. Coal inventory as of 31st March 2026 stood at 25 days. According to Ministry of Coal, to address any potential energy shortages in the current evolving situation, the national coal stockpile of over 210 million tons represents a buffer of nearly three months of energy consumption. While imported coal price during quarter four averaged nearly $53 per ton, higher by 6.6% compared with the same quarter last fiscal. However, at $47 per ton, prices were lower by nearly 10% in FY 2026 compared with FY 2025. Overall, the fuel situation for the sector remained comfortable throughout the last year. Let us now talk about few important regulatory updates and policy initiatives during the year.
In January, Ministry of Power released a Draft National Electricity Policy 2026, aimed at aligning the power sector with Viksit Bharat goals over the next two decades. The draft prioritizes cost-reflective tariff reforms, a phased reduction in cross-subsidies, and time-of-day peak-hour pricing to improve efficiency and strengthen DISCOM finances. It has also set ambitious consumption targets of per capita electricity use, rising to 2,000 units by 2030 and over 4,000 units by 2047. For deepening power markets, the draft proposes building frameworks to establish generation capacity addition through market mechanisms such as bilateral contract settlements. It further outlines use of standardized contracts to be executed on power exchanges and possibility of electricity from long-term PPAs to be routed through power exchanges or any other platform recognized by the CERC.
These are positive initiatives for the development of the sector and that of the power market. Key amendments have been proposed to the Draft Electricity (Amendment) Bill, 2025, wherein state electricity regulatory commissions have been empowered to determine tariffs suo motu to ensure timely cost recovery and avoid delays. Cross-subsidies are to be progressively eliminated within five years for manufacturing, railways, and metro operations. In a push for C&I and open access consumers, DISCOMs may be exempted from Universal Supply Obligation to C&I users with more than 1 MW load. Also, DISCOMs would provide non-discriminatory open access to multiple distribution licensees on payment of wheeling charges. These proposals would enhance competitiveness of the C&I segment. CERC issued final guidelines for VPPA in December 2025. These guidelines recognize power exchanges as authorized platforms for sale of electricity by RE generators entering VPPA arrangements. This should help increase volumes on exchanges.
The CERC issued First Amendment to REC Regulations, 2026, clarifying REC applicability for designated consumer, Renewable Consumption Obligation, and VPPAs. Under these amendments, RE-based captive plants may be issued REC but cannot trade REC to the extent of self-consumption of electricity. Amendments also specify source-based REC multipliers that would remain valid for 15 years. These multipliers should help increase REC inventory going forward. The MoP has already issued the final notification on renewable consumption obligations, allowing fulfillment through multiple avenues, including RECs from VPPAs and enabling fungibility across wind, hydro, and other components. We have sought CERC approval to align on green contracts with the revised RCO framework, and the matter is currently reserved. Once approved, this alignment is expected to bring greater clarity on RE sale and procurement and support higher renewable participation.
Ministry of New and Renewable Energy of India, that is MNRE, has approved a 500 MW pilot CFD for RE on a three-hour basis to be implemented by SECI. This pilot shall enable RE generators to sell electricity on power exchanges while SECI settles the difference between the discovered strike price and the reference market price. The pilot would supply 1,500 MWh of RE power daily for three non-solar hours, with settlements based on DAM prices and backed by a CfD Stabilization Fund of INR 76 crore provided by the government. With regards to carbon market, the Ministry of Environment, Forest and Climate Change has issued final notifications on greenhouse gas emission intensity targets for seven sectors, aluminum, chlor-alkali, cement, pulp and paper, petrochemicals, petroleum and textiles, while notifications for iron and steel are awaited.
These sectors account for about 16% of India's GHG emissions, with a combined baseline of 480 million tons carbon dioxide equivalent in FY 2024, targeted to decline to 465.3 million tons by FY 2027. The carbon credit certificate trading procedures are currently being drafted by the BEE in consultation with Grid India. These developments have laid the foundation for trading of carbon credit certificates on power exchanges. CERC issued an order on implementing market coupling on 23rd July 2025, in which the regulator decided to initiate the process of implementation of market coupling of day ahead market by January 2026. Subsequently, IEX had filed an appeal in the APTEL. In its order issued on February 13, 2026, APTEL mentioned that as market coupling cannot be implemented without regulations, IEX is not an aggrieved party at this stage.
As per the order, as and when final regulations are issued, and if IEX is aggrieved by them, they have the liberty to challenge the regulations before an appropriate forum, including all grounds raised in the appeal filed before APTEL. Further, on April 17th, 2026, CERC issued draft regulations for market coupling, according to which Grid India would act as a market coupling operator, that is the MCO. Also, Grid India would be responsible to frame detailed procedure for implementation of market coupling. CERC has invited stakeholder comments on the draft till 16th May 2026. On IEX performance in quarter four of financial year 2026, IEX recorded the highest ever quarterly traded electricity volume of 39.4 billion units, higher by 24.3% on a year-on-year basis. In the full year, FY 2026, electricity volumes touched 141 billion units, higher by 17% on a year-on-year basis.
In terms of RECs, during the quarter, a total of 71.7 lakh RECs were traded, an increase of 6% over the same quarter in FY 2025, and during the full year, a total of 187 lakh RECs were traded, recording a 5% increase over the last year. For the quarter, consolidated revenue for the company grew by 12.5% year-on-year, increasing from INR 174.6 crore in Q4 FY 2025 to INR 196.4 crore in quarter four of FY 2026. Profit after tax increased by 10.8%, rising from INR 117.1 crore in Q4 FY 2025 to INR 129.8 crore in quarter four of FY 2026. For the full year, profit after tax was higher by 14.9%, from INR 429.2 crore to INR 492.9 crore in the present year. The Board of Directors have announced a final dividend of INR 2 per share, equivalent to 200% of face value of the equity share.
Within electricity segment, RTM volumes at nearly 14.3 billion units in quarter four were higher by 48.2% on a year-on-year basis. In FY 2026, RTM volume grew nearly 41% year-on-year to 55 billion units compared with FY 2025. The RTM segment has continued to grow strongly with 39% share in electricity volumes at IEX. This segment has played a critical role by offering flexibility in power procurement and providing immediate responsiveness to efficiently integrate renewables with the grid. Green market volumes in quarter four FY 2026 rose 26.5% to 2.4 billion units compared with quarter four of FY 2025. For full year, the segment traded 10.8 billion units, an increase of 23% over FY 2025. This segment helps obligated entities, including DISCOMs, meet their renewable purchase obligations. With capacity addition, increase in solar, hydro, wind, and sustained supply from coal-based generation, supply, liquidity, and power exchanges improved and led to a substantial drop in the prices.
In quarter four of financial year 2026, volumes in the day ahead market of IEX increased nearly 49% on a year-on-year basis. As a result of which, the prices in the day ahead market at INR 3.89 per unit were down 12.2% year-on-year, while prices in the real-time market averaged INR 3.68 per unit, a 15% drop. For the full year, sell liquidity in the day ahead market was higher by 44% at INR 3.86 per unit. The average DAM price during the year was lower by nearly 14% compared with the last year. Similarly, at INR 3.59 per unit, the average price in the RTM segment in this year was lower by 16% compared with FY 2025. These prices presented an opportunity for DISCOMs and C&I consumers to meet their demand at a competitive price and to replace their costlier power by procuring through exchanges.
On the products front, we continue to await approval from the CERC on a petition to extend the term ahead market contract to 11 months. Similarly, with regards our Green RTM petition, CERC has reserved its order. To support development of merchant storage capacity, we have filed a petition with CERC seeking introduction of Peak DAM and Peak RTM segments. These segments are intended to enable power trading during high-demand periods, such as late evenings and early mornings. The CERC's order on this petition is currently reserved. On IGX front, the Indian Gas Exchange completed five years of operations in financial year 2026. The exchange currently represents close to 3% of India's overall gas consumption and 20% of the spot market.
For quarter four of financial year 2026, IGX traded gas volumes of 18.6 million MMBtu, lower by 8% over Q4 FY 2025, largely on account of supply disruptions in the Middle East beginning March. For the full year, IGX traded gas volumes of 76.8 million MMBtu, a growth of 28% on a year-on-year basis, led by demand from domestic gas producers, heightened power demand, and demand from city gas distribution. IGX recorded a profit after tax of INR 9.4 crore in quarter four FY 2026, which was higher by 5.4% compared with INR 8.9 crore in Q4 FY 2025. For the full year, IGX recorded a profit after tax of INR 41.9 crore, which is higher by 35%, compared with INR 31.9 crore in the same period last year. Going forward, the geopolitical challenges in the Middle East, volumes could remain impacted, though some of it may be offset domestically.
On the way forward, while power demand remained largely subdued in FY 2026 owing to weather conditions, CEA's projection of demand approaching 2,500 BUs by 2032 continues to support exchange volume growth. For this summer, the CEA has projected peak demand to reach 270 GW, accompanied by the El Niño effect, which is expected to strengthen post June 2026. While in the short term, this raises some concerns on sell-side liquidity, however, the government has already invoked measures under Section 11 for some imported coal-based plants to operate at full capacity, which will be effective till June 30th, 2026. This is expected to increase supply in the system. During FY 2026, India's power sector witnessed the emergence of new market mechanisms such as VPPA, electricity derivatives, contract for difference, and battery storage arbitrage.
While implementation of 13 GW of BESS projects under the first VGF tranche is underway, tenders for nearly 3/4 of the 13 GW under the second tranche has also been awarded. Falling battery storage costs keep accelerating BESS adoption, with APTRANSCO having discovered the lowest price ever under the VGF mechanism in November 2025, INR 145 per unit for 1,000 MW, two-hour, two-cycle tender. Earlier this year in February, NVVN discovered INR 1.77 per unit for a 250 MW, two-hour, two-cycle tender. This year also marks the first merchant BESS trades at IEX from Juniper Green Energy Limited, the largest operating BESS asset in the country. Subsequently, ACME Solar and Adani Green have also leveraged storage arbitrage opportunities on the exchange platform. These developments deepen India's power markets and strengthen India's path towards energy transition. IEX's other diversification initiatives are also gaining traction.
For quarter four of financial year 2026, the IEX issued 46 lakh I-REC, higher by 29% compared with quarter four of financial year 2025. For the full year, IEX issued 179 lakh I-REC, recording a growth of over 200% compared with FY 2025. Revenue for IEX during the quarter stood at INR 2.2 crore and INR 7.7 crore for the full year respectively. With regards to coal exchange, the Ministry of Coal has come out with draft regulations for the exchange, and final regulations are expected later this calendar year. In pursuance of this opportunity, the IEX Board has accorded in-principle approval to explore establishing a coal exchange in line with the proposed coal regulations 2025, issued by the Ministry of Coal. As India advances towards its net zero goals, energy markets are expected to play an increasingly significant role in shaping the nation's energy ecosystem. Thank you.
We can now have the question and answers.
Thank you very much. We will now begin the question- and- answer session. Anyone who wishes to ask a question may press star and one on the touch-tone telephone. If you wish to remove yourself from the question queue, you may press star and two. Participants, you are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. A reminder to all, you may press star and one to ask a question. We have the first question from the line of Balasubramanian from Aditya Capital. Please go ahead.
Good afternoon, madam. Thank you so much for the opportunity. Madam, I'm trying to understand our coal exchange, IGX, and mineral exchange as part of diversifications. What is the estimated TAM and revenue potential of a coal exchange in India, given that coal is largely allocated via long-term linkages? I'm trying to understand what are the monetization models in terms of transaction fees, membership data. Because it's not like gas, power, these things are standardized, while the coal and all is heterogeneous, logistics-heavy commodities. I'm trying to understand how we are going to take it forward.
Yeah. Good afternoon, everyone. I am S N Goel. Let me respond to this question. Yes, sir, as coal is concerned, today, coal is allocated for thermal power generating stations, and the allocation of coal is not to meet the full requirement of the power plants. Many of these power plants who have the PPAs still they purchase coal from the market. There are merchant power plants. There are other industries also who uses coal. There is large opportunity on the buy side. On the sell side, we used to have in fact shortage of coal. That is why there were a lot of problems and that premium in the e-auction market was also very high. Subsequently, the Ministry of Coal had taken many initiatives.
They allocated many mines for the captive production, and also some of the mines were auctioned for the merchant production of coal. Subsequently, the industries having captive mines, they were also allowed to sell up to 50% of the coal in the market. I think all these provisions have now increased production of coal in the market, so that coal is now available in surplus quantity. Today we have multiple sellers in the market. It is not the Coal India alone. We have multiple sellers, captive mines are there, merchant mines are there, and also there are many buyers in the market. We have a multi-buyer, multi-seller model in the market available. If you look at the draft regulations, it says that even the e-auction coal will have to be transacted through the exchange. Last year, the e-auction coal transaction was about 80 million tons.
This provides a significant opportunity for the coal exchange. In addition to this, there are other industries also which buy coal. I think the opportunity size based on that is going to be quite large, but we will have to wait for the final regulations to come, and only when the final regulations come, then we will be able to estimate the market size. I feel that it is an initiative of the Government of India, because they feel that exchanges provide a lot of value in this. It leads to transparent price discovery and both physical and financial settlement in time. I'm sure government also is going to take a lot of policy initiatives to ensure development of the coal market. With this, we feel that it's going to be a good opportunity to get into the coal exchange.
Okay, sir. Sir, my next question on that EnergX platform and bidding API side. What percentage of our total volumes now flow through API, compared to manual web bidding? Is there any large DISCOMs or C&I customers integrated their ERP directly with IEX API?
In fact, more than 70% of our cleared volume is through the API system. Many of the distribution companies are already connected with us through the API. Generators are also connected with this. I think there is a significant improvement on quarter-to-quarter basis, and I'm sure in the time to come, almost everybody will do the bidding through the API system.
Okay, sir. Sir, my last question, in that presentation, it mentioned about AI-based application development and security monitoring. Whether if you could share some examples in terms of AI model deployed, whether it is improved match efficiency, reduced penalties, or optimized bid suggestions. If you could share some clarity on the AI-based application development and security monitoring side.
We are not using AI for the price discovery. Price discovery is by our MILP-based algorithm, which is a linear programming-based model. At the moment, we are using AI for basically, we have a software team which is doing all activities for creating new products and managing the things. There we are using the AI system now, so it is reducing our coding time and, in fact, there is a significant improvement in the efficiency also. Another area is basically security. That is providing us a robust platform. In spite of so many instances of hacking, there has not been a single instance where they have been able to penetrate our system. These are the advantages of this, and we are also working on many other areas where we can use AI application to benefit our customers.
It's basically operational improvement, right, sir?
Yes. You're right.
Yeah. Yeah. Thank you, sir.
Thank you. We will take the next question from the line of Sumit Kishore from Axis Capital. Please go ahead.
Good afternoon, Goel sir and Aparna. My first question is on the fourth quarter result. The other income seems to have slowed down versus the quarterly run rate over the last four quarters, down about 29%. Anything to call out here?
I will request my colleague, Mr. Vineet Harlalka, who is CFO and Company Secretary of the company, to respond to this question.
Yeah. Hi, Sumit. Sumit, the major reason was that if you look at the December quarter number, it was a significant increase over the treasury income because there was a one-time gain we got because the interest rates were there and the market was improving. As you all know, because of the Iran conflict and rupee situation, there was a significant correction in the market during this month of March, especially. A bit of mark-to-market impacts were there, and that was reflecting in the numbers. Previous quarter, there was one-time gains. Those were there. As the market is recovering, we will see that the numbers going back to the earlier numbers.
Okay. So, there are some non-recurring factors which have depressed numbers here?
Yes. Right.
Okay. Second question is regarding timelines now. The public comments closed on the 16th of May on the Draft PMR. If you can maybe elaborate on what would be your legal or commercial strategy, if you can, or what will be the timelines that you have for the final notification of PMR to come out? Subsequently, when does the power market coupling procedure come out? What sort of timelines do you think are in store?
Sumit, it is very difficult to say on that. If you recall, this PMR 2021 was issued in February 2021, but the draft of that came, to best of my knowledge, in 2019. Can't really say how much time they will take because these are bigger issues of market redesign. I'm sure CERC is going to take into cognizance the comments they receive and also look into the aspect of market redesign. We really cannot say how much time they will take to issue the final notification.
This will be public comments, so there will be like the stakeholder consultation which had happened, there will be detailed comments from all parties.
Yes.
Okay. I think, finally, just one question on the gas exchange. I know the Strait of Hormuz is still not functional. In terms of the gas exchange, Q1 can be quite depressed. What are the levers to shore up volumes on the gas exchange?
See, as of now, since the gas is not coming from the [audio distortion] and India was getting significant quantity of gas from that side, that is one issue. Second issue is that gas prices are also very high. Indian market is quite sensitive to the gas price. Therefore, the volume in March and also in April so far are not as good as what we had planned for it. I'm sure the situation is going to improve. As and when this improves, we should be able to catch up with the volume growth that has been happening on the gas exchange. My estimate is that maybe in the first quarter, we may not get any growth with respect to the last year first quarter. From second quarter onwards, we should be able to even achieve the growth also.
The volume that you do in Q1 this time, that would be with gas coming from where? Or would it be domestic gas getting traded?
As is, there are still LNGs coming from different other sources.
Other sources.
Part of that LNG is also getting traded. There is domestic gas also, which is also being traded on the exchange platform. In the domestic gas, like you know, ONGC and Reliance, they have high pressure, high temperature gas from the east coast site at Krishna Godavari ( KG-D6) fields.
Mm-hmm.
They sell a part of that gas on the exchange platform. Similarly, domestic gas available with other suppliers also, part of that is being sold in the market.
Okay. Basically, that stake reduction in IGX now, you have got time up to which month?
PNGRB has given us time up to 31st of December 2026.
Thank you, sir, and wish you all the best.
Thank you.
Thank you. We will take the next question from the line of Kunal Thanvi from Banyan Tree Advisors. Please go ahead.
Hi. Thank you for the opportunity. I had two questions. One was on the recent draft from CERC on market coupling. What we understand is, in the last avatar, when the draft had come in July 2025, it was about that round robin, which we had a case against it, like we fought it, and then finally this new thing has come where they're saying that Grid India will become MCO. When we were reading the first draft that was in July 2025, operationally, it looked like very cumbersome to implement. When you read this one, what is IEX sense on implementation of this kind of structure that now CERC is talking about? That is point number one.
Point number two, while multiple times we have done the study and there's been an outcome that market coupling in the current structure without MBED will not fulfill any objective from an efficient price discovery perspective. What is the intent of the regulator in terms of pushing for market coupling? Is it that they want price discovery to happen on Grid India itself, so one particular exchange don't have advantage? Or any other insights that you can share. The second was on a possible buyback, if you can throw some light on how we as management team and the board is thinking about buyback at these prices. Thank you.
Yeah. Let me first respond to your coupling question. As you are aware, CERC in the order in the month of July, they had mentioned that market coupling, when they had market on round robin basis will be done. Now they have changed their decision, and in the draft regulations, they are talking about Grid India. I think situation is still fluid. I personally feel that situation is still fluid even on the market coupling. Maybe in due course of time, they may review their own decision about the market coupling also, and may not go ahead with this. I cannot really say anything on this, what is finally going to happen. Even round robin was not a complicated mechanism. All three exchanges have their software, and they will have to only collect the bids.
The designated exchange was required to aggregate the bids and do the price discovery. Now Grid India will have to create the infrastructure and software for this, which will be additional costs. I don't think it is going to really provide any value in the process. It all depends on what regulator decides to do. We'll have to wait and watch for that. Your second question was about the benefit from the coupling. I fully agree with you that based on the studies done so far, there is no benefit of coupling, and I'm sure regulator will also take note of this. The third is buyback. I think on the buyback, the mechanism for doing buyback, there is still no final decision has been taken by SEBI so far. I will request my colleague, Mr. Vineet to share on this.
The SEBI, their tender route is available. There was a taxation issues in the previous year. Now with the budget, the government come out with a revised tax structure. Again, buyback become one of the good options for distributing money to the shareholders. We are definitely considering it. We are also waiting the draft notice SEBI had come out from the open market route, which they disallowed earlier. The management is observing all the developments. They will take a due call considering the benefit of the stakeholders.
Great. Thank you. Just had a couple of follow-up. One was where we are in the IGX IPO process. Secondly, on coming back to the market coupling, whatever form and shape the current draft talks about, this essentially means that if that goes through, then all the three exchanges, the key functionality of them would be collecting bids and submitting it to Grid India, who will discover the price and then the trades get aggregated. Is that right understanding?
Yeah. Exchanges will be again doing the physical and financial settlement. All that will be done still by the exchanges. Only the price discovery will be done by the Grid India.
Okay. On IGX?
I think IGX IPO process, we have initiated the process, so I am not really fully aware about the exact status of that. I think it is progressing well.
Okay. Sure. Thank you, and all the best.
Thank you.
Thank you very much. Before we take the next question, ladies and gentlemen, in order to ensure that the management should be able to address all the questions from the participants in the question queue, we request you to kindly limit your questions to two per participant. If you have a follow-up question, please rejoin the queue again. We will take the next question from the line of Prawin Visesh from PPFAS Mutual Fund. Please go ahead.
Good afternoon, sir. My first question was on the coal exchange opportunity we are studying. Here, logistics in coal is usually a bottleneck, right? Because in many cases, the landed cost of coal for the user increases significantly because of the logistics cost. From an exchange point of view, more than just price discovery, what are we adding in terms of building efficient logistics network?
Yeah, in case of coal, there are many challenges, quantity, quality, and the transportation, all these are issues. We'll have to work on all these things. I think logistics is definitely a very important part of it. Initially, what we intend to start is that maybe the buyer will have to make their own arrangement for lifting the coal. We will discover the price, finalize the price, and then ensure that the coal is available to him at the loading point of the right quality. Then he will have to make their own arrangement for lifting the coal. Subsequently, when we are able to finalize arrangements with the railways for supply of coal to the exchanges also, then maybe we can provide that service also.
Got it, sir. Sir, my other question was regarding the clarity that we received regarding coupling. At least there is some clarity compared to before. How are the trading participants reacting to what is happening? I understand from an exchange perspective, there can be some changes, but what are the trading participants reacting? Given that we have been maintaining long-term relationships with a lot of these traders and trading participants, how are they reacting to this, and what?
I don't think there's going to be any change in their working. They will continue to submit their bids to the exchanges, and it is only that from the exchange operation, just the price discovery function is being taken. Otherwise, rest of the job will continue to be done by the exchanges only.
Yeah. What initiatives are being taken to ensure that these relationships with our exchange continues?
Point is, it is, for the last 18 years, we are doing only one thing, relationship building with our customers.
Mm.
We'll continue to do that. That is why we have a strong customer base with the company and customer loyalty. That's our USP.
Got it. My last question was on the VPPA thing. Is there any more momentum or interest picked up on this post the draft regulations, or is the interest still coming from the tech companies?
Not significant so far, but let's see. Maybe with the data centers coming into the market or some multinationals taking some interest in this, something should happen.
Okay. Thank you. Thank you for taking my questions.
Thank you.
Thank you. We will take the next question from the line of Ketan Jain from Avendus Spark . Please go ahead.
Thank you. Good afternoon, sir. If you can help us explain the SECI tender of the contracts for differences, how does it help exchanges and what's the basic framework?
Yeah. As per that contract, SECI will contract certain battery capacity at a fixed price, and that gentleman will sell that power in the market. The important part is this, so that battery capacity will be selling power in the day ahead market. Exchanges will get that liquidity, that 500 MW power for three hours will be available for sale in the exchanges. That's the benefit which the exchanges will get. If the sale price is more than their contracted price, maybe there will be some sharing of that profit gain between the SECI and that party who is setting up this capacity.
Understood. This is a pilot tender. Do we expect more tenders coming in this?
Yeah, definitely. If you look at European countries, they're almost about 50%-60% of their renewable capacity addition is happening through the CFD contracts. Because under the CFD contracts, you don't need any PPA, you don't have any scheduling issue, you don't have any payment issues. They do all this capacity addition on the CFD route. Now, this is for the first time Government of India is trying on a pilot basis. I'm sure with the success of this project, many more projects will come, should come. Even this will be a, this will also pave the way for the private investors. If the result of this pilot is positive, maybe they will also set up capacity on merchant basis.
Understood. Is this only for battery or it's a technology agnostic, it can be wind as well?
This is set for battery, what I believe.
Okay. Sir, my next question is on what's your expectations for volume growth in FY 2027?
I think we have been achieving a volume growth of 15%-20% every year, and this year, in fact, the demand is also going to be high. With the new capacity additions and demand increasing, we should be able to maintain this volume growth of 15%-20%.
Understood.
Everything depends on the demand, supply. These are all factors which are outside the exchange control.
Certainly. Sir, what is the reason for a fall in REC volumes in this year compared to last year? Any specific reason?
There is no fall. There is in fact, 5% increase in the REC volume.
Okay.
Yeah.
Okay. I come back with you, sir. Thank you.
Okay.
Thank you. We will take the next question from the line of Nitin Shakdher from Green Capital Single Family Office. Please go ahead.
Hi. Good afternoon to the management. This is Nitin Shakdher from the Green Capital Single Family Office. My question is more as an investor rather than an analyst. Let's assume the worst case scenario, that the market coupling regulation goes against the company and you lose the legal case. Now, obviously, as a risk management strategy, you would have decided to have strategies in place in case that were to happen. But is the understanding correct that the traders will have no functional reason to prefer IEX? And maybe the smaller new exchanges like HPX and PXIL will be able to attract slightly more volumes and erode market share and might be some margin pressure. How do you anticipate in case the regulations were to go towards the market decoupling?
It's just clarity from the management once and for all, so at least we can anticipate both sides of the equation. Thank you.
Yeah. First of all, as far as market coupling itself is concerned, it will not be fair to assume that market coupling is going to happen. There are still things under discussions. When taking your question that you have seen the worst case scenario, if it happens, one is that customer loyalty is very important. In the last 18 years, as I told earlier, that is what we have been doing. We have been interacting with the customer, understanding their problem, creating products to address that problem, telling them how to use the exchange platform, providing them data analytics, having API system for faster billing, and also financial settlement of the transactions. All these things, the value additions which we are doing, I am sure we will be able to retain our customers. This is something we will continue to do in future also.
With that, I'm sure that even after coupling also, we should be able to retain significant part of the market share in this DAM segment.
Any potential offset for margin that you have done that it might have a minor impact or margins might go down because you've always been dealing with this situation over the last one and a half years. Do you expect a margin because the business valuation is already reflecting that the liquidity moat is not there at this point in time in terms of the dominance. Do you think that there might be a slight changes in margin in case the worst case scenario were to come around or it's just business as usual and you think that we have to accept it and carry on with what it is?
I can only give you one example that in case of the term ahead market, where the liquidity is practically uniform across all three exchanges. The share of all three exchanges is in that same range of 40%, 50%, 30%, 20% kind of numbers. That market is operating for the last four years, and in that market also, the margins are intact. Against INR 0.04 , I think the margin is around INR 0.036, INR 0.037 . That's the kind of number. We don't expect significant impact on the margin part of it, the transaction fees part.
Okay. Thank you, sir, and all the best for the future.
Thank you.
I hope you can retain the dominant position for IEX. Thank you.
Thank you. We will take the next question from the line of [Nikunj Bajaj] from, an individual investor. Please go ahead.
Okay. The question here is, IEX basically will be assuming that the guidelines comes into place, the IEX will have to forward the bids to Grid India. Now, this would require lot of software reengineering at your end. That is at IEX, the software reengineering has to be done. What would be the rough estimate cost and what, for this kind of an uncalled activity?
We have our own software team.
Okay.
I'm sure our team will be able to do all these things.
It will not have any additional cost, is it?
No. No additional cost.
Okay. Thank you.
Thank you.
Thank you. We will take the next question from the line of Ravi Purohit from Securities Investment Management Private Limited. Please go ahead.
Yeah. Hi. Thanks for taking my question. Sir, on the market coupling, can you just share about, let's say, RTM? I think this time's notification says that they would also like to include RTM. But is there anywhere, either in Europe or anywhere else, where RTM actually has market coupling? And secondly, India probably has some 48 sessions in a day, right, whereas Europe, I think at best could do some three sessions in a day or four sessions in a day. If you could just share the operational, how the RTM actually functions, and with more and more intermittent power capacities coming in from solar and wind, which mostly would be working with RTM. If you could just help us understand the entire ecosystem on which RTM operates and where does this end?
Also, once the gate closure happens, to finalizing the bid, price discovery, schedule, everything, what kind of time latency do you have and how much all of these things will work out? If you could just highlight some of the issues about RTM, it will be helpful.
Yeah. First question is that, what is the practice world over? In the RTM market, we haven't come across a case where there is a market coupling, because RTM market, the timelines are very tight. In fact, if you look at the CERC order, which was issued on 23rd of July 2025, that also says that looking at the tight timelines of the RTM market, they will like to look at the performance of the DAM market and then see whether it is feasible for the RTM market or not.
Mm-hmm.
As far as these draft guidelines are concerned, there is just an enabling provision that in the RTM to be done from a date to be notified in future. If they decide to do something in future, then they can do that part of it.
Okay.
There is no such decision as of now.
Right.
Because in case of RTM, the number of times it is to be done is 48, and today it is 15 minutes time block. We are talking about, because of the renewable five minutes time block, then in that case, instead of the 48, it will be 48 by 3. The time available for doing all these activities also is very small. There is no slack time in the process. It is going to be very difficult. I have my own doubts about coupling in the RTM market.
Okay. Right now, if suppose there is some issue, so let's say in stock market parlance, when there is a trade which goes wrong, there is some auction or there is some settlement happens. What happens in a power market when an RTM trade kind of does not get through or something happens during that period? In current situation, suppose if were somewhere to add this additional latency period of doing it between three exchanges, giving it to MCO, MCO coming back. It just sounds too complicated. I don't know if it is like [crosstalk].
The point is this, in case of coupling in the RTM market, if out of the three exchanges, if one exchange data do not get aggregated at the place, then you lose significant buy and sell volume. That may lead to sudden jerk in the price and the volume discovery. It will definitely have a very adverse impact on the market. In case of day ahead market, you still have time available because you do only one auction a day. In case of RTM, we do about 48 auctions in a day. I'm sure all these things will be considered by the regulator also before taking a final decision on this.
Right. Sir, since the July 2025 directions, that notice was issued first on market coupling and now this again in April. Between then and now, what has been the count of registered participants on our exchange? Have they gone up or have we kind of lost any customers to competing exchanges?
No. We are only getting customers, we are only getting customers. They're still increasing. Numbers is increasing.
In the past, you used to have customers in the form of DISCOMs or some generators, right? Now, going forward on the next three to five years, what kind of customers would we actually get as more and more people take OA licenses and all? What kind of customers do you envisage over a period of time now? Historically, it used to be only two sets of guys, DISCOMs and let's say maybe some traders and some power generators.
No. In fact, right from the day one, it has been distribution companies, trading companies, generating companies, and also industrial consumers.
Okay.
Because open access consumers also do significant transactions through the exchange platform.
Mm-hmm.
These industrial consumers, it is not only that they buy power to optimize their cost, but there are also many industrial consumers who have the captive generation, and if their captive generation is not working, then they purchase power from the market to take care of the outage of the unit. There are cases when the industry production is not up to the 100% and they have surplus power available, they sell that power. We have more than 5,000 industrial consumers who are using this with us, and now the renewable generators are also coming to the market. The renewable generators, the battery suppliers. The number is increasing every day, in fact.
Okay. All the best, sir.
Thank you.
Thank you. We will take the next question from the line of Lokesh Manik from Vallum Capital. Please go ahead.
Yeah. Hi, good afternoon, sir. Am I audible?
Yes. Good afternoon.
Sir, my first question was on the coal exchange. If you can just give us a sense of what would be the current spot market in India in the coal industry, just to get an idea of the opportunity size.
At present, almost about 80 million-90 million tons of coal is being sold through the e-auction route, which is, you can say, the so-called market.
Right.
In addition to that, we are also importing almost about 150 million tons of coal for the power generation.
Mm-hmm.
With increase in the domestic production, that market also should get replaced by the domestic coal market.
Mm-hmm.
The opportunity as of now is big. Let's see what is the final notification.
This should be higher than the gas because gas is 12% today at spot. What you just mentioned just turns out to be about 20%-25% spot in coal, import plus e-auction.
No.
That's a fair assessment?
What I said is, at present, it is almost about 15% is in the spot, in the case of coal also.
Okay, 15%. Okay.
Yeah.
Okay. Great. My second question was more a clarification. As we understand, in 2022, when the new Renewable Energy Act came in, it gave a lot of leeway to C&I customers, especially for open access. Where earlier thermal buyers were facing a problem, where different states had different charges for open access. For green energy, this was sort of relaxed. It was conditioned upon intrastate exchange of power. Do you expect that power also to come onto the exchange now as green energy comes in, installation increases intrastate, without open access hurdles?
Yeah, we have already started seeing that happening now. As a result of that, our volume in the G-DAM market.
Huh.
Is in fact increasing every year.
Okay.
Last year, the number I think was about 10 billion units in the course of the G-DAM market. Anything near that number?
Correct.
Yeah. According to you, this number is increasing. There's increase of almost about 7% with respect to last year. The green energy participation in our exchanges are increasing.
Okay. You also have a tailwind coming on that when the renewable energy installation happens, if it gets commercialized prior to the timeline, then they can come on the exchange and sell it.
Yes.
Before. So, that benefit is also still continuing or you are seeing some slowdown there?
Yes, it is continuing.
That will continue as long as we have good installations coming in on the [crosstalk].
Yeah, definitely. Because they get the benefit of also, if they are selling power in the conventional market, they can get the RECs. If they are coming in the green market, then they get a premium of the green market.
Understood. Sir, my last question was for the coal exchange. Even NCDEX has filed an application for coal exchange. I understand they will be in the financial space, that is, the derivatives. We will be in the spot. Do we have any agreement with them similar to the electricity futures?
We don't have any such agreement, but let's see. I mean, we are waiting for the final regulations to come, because only after the final regulations you can really estimate what is going to be the market size, and then maybe we'll see
Correct. Sir, lastly, how is the electricity futures developing? Have you started to receive some revenue from there in electricity futures?
Quantum in that is not significant.
Huh.
The revenue share is not meaningful.
Okay. Got it. That's it from my side, sir. Thank you so much.
Thank you.
Thank you very much. Ladies and gentlemen, we will take that as the last question for today. With that concludes the question- and- answer session. I now hand the conference over to Ms. Aparna Garg for closing comments. Over to you, ma'am.
Thank you, everyone. I would like to thank each one of you for being a part of today's call. We at IEX remain committed to contribute to the development of a sustainable and energy-efficient future for India. Have a wonderful evening. Thank you.
Thank you, members of the management. On behalf of Axis Capital Limited, that concludes this conference. Thank you all for joining us and you may now disconnect your lines. Thank you.