IEX Shares Tumble To Two-Year Low After Power Ministry Mulls Market Coupling
The coupling of exchanges is expected to bring down the market share of Indian Energy Exchange Ltd., which has 99.9% market share.
Shares of Indian Energy Exchange Ltd. tumbled to a two-year low after the Ministry of Power asked CERC to initiate the process of market coupling for power exchanges.
The ministry also asked the Central Electricity Regulatory Commission to take suitable action for consultation and finalisation of a construction project with multiple exchanges.
The coupling of exchanges is expected to bring down the market share of Indian Energy Exchange Ltd., which has a 99.9% market share.
The stock has also been downgraded by Antique Broking as it fears that the past era of high volume growth for IEX may be "difficult to mimic", according to Bloomberg.
It sees power spot prices remaining higher than bilaterally negotiated prices between power distributors. It set a price target of Rs 105 apiece.
The average calculated from the 12-month price target given by analysts implies a potential upside of 20%.
Shares of the Indian Energy Exchange dropped 14.99% intraday before trading at an 8.98% low as of 9:59 a.m. This compares to a 0.05% decline in the benchmark NSE Nifty 50. The stock has dropped the most since May 28, 2021.
Total traded volume stood at 41 times its 30-day average. The relative strength index was at 16, implying that the stock may be oversold.
Out of the 17 analysts tracking the company, eight maintain a 'buy' rating, three recommend a 'hold' and six suggest a 'sell' on the stock, according to Bloomberg data.
