The Business
Incorporated in 2003, Multi Commodity Exchange of India Ltd (MCX) is India based electronic commodity
futures exchange. MCX provides online trading facility along with clearing and settlement operations for commodity futures
across India. There are five officially recognized electronic multi-commodity national exchanges in India including MCX,
NCDEX, NMCE, ICEX and ACE. These five national multi-commodity exchanges accounted for 99.5% of the turnover of
commodity futures contracts traded in India. MCX is the largest among these and have above 80% of the market share of the
Indian commodity futures exchange industry. MCX allows trading in more than 50 commodities across sectors like bullion,
metals, energy, weather, and agricultural products. The Exchange is the world's largest exchange in Silver, the second largest
in Gold, Copper and Natural Gas and the third largest in Crude Oil futures, with respect to the number of futures contracts
traded. As of December 31, 2010, MCX has more than 2,107 registered members operating through over 180,000 trader
workstations in over 1,139 cities across India. MCX emerged as the 5th largest exchange in the world. The total value of
commodity futures contracts traded on its Exchange in the nine months ended December 31, 2011 and the fiscals 2011, 2010 and
2009 was Rs.119,806.89 billion, Rs.98,415.03 billion, Rs. 63,933.03 billion and Rs.45,880.95 billion, respectively. According
to data maintained by the FMC, these amounts represented 87.3%, 82.4%, 82.3% and 87.4% of the Indian commodity futures
industry in terms of the value of commodity futures contracts traded during the same periods. MCX was the first national
commodity futures exchange in India to offer futures trading in steel, crude oil and several other commodities, including carbon
credits. It was the first exchange in India to initiate evening sessions to synchronise with the trading hours of global exchanges in
London, New York and other major international markets. It has been certified under ISO 9001:2008 for quality management
standards and ISO 14001:2004 for environmental management systems with respect to developing and providing services for
online trading, clearing and settlement facilities, and risk monitoring of commercial derivatives market. It has also achieved the
ISO/IEC 27001:2005 certification, which is the global benchmark for information security management systems.
Its Promoters owns 31.18% of its equity share capital. Its other larger shareholders include financial institutions and other entities
from the financial sector, such as FID Funds (Mauritius) Limited (an affiliate of Fidelity International), Euronext N.V. (an affiliate of
NYSE Euronext) and Merrill Lynch Holdings (Mauritius).
Objects of the Offer
Since the Offer is a pure offer for sale and the Company would not receive any proceeds from the
Offer, the Company has not appointed a Monitoring Agency for the Offer.
Competition
MCX faces competition in all aspects of its business and compete directly with four other national level
commodity exchanges in India, namely NCDEX, NMCE, ICEX and ACE. It believes the principal factors affecting competition
with its Exchange include product portfolio, quality of technology (which includes ease of use, connectivity, security,
scalability and customer service), liquidity, transaction costs, speed of execution and transparency.
Peer Comparison
As there are no listed companies in India that are directly comparable to the business carried on by the
Company, no comparison with industry peers is being offered.