Reliance Money, FTIL plan stock exchanges

The National Stock Exchange (NSE) and the Bombay Stock Exchange (BSE) are set to have some serious competition. Reliance Money, controlled by the Anil Dhirubhai Ambani Group, and Financial Technologies India Ltd (FTIL), which operates one of the world’s largest exchange networks, are exploring the option of setting up their own equity exchanges Sources familiar with the developments said both companies see enormous scope in this space since only 5 per cent of Indian households invest in equities compared to the international average of up to 50 per cent. The scope for a new exchange can be seen from the rapidly growing business of equity derivatives, which are basically instruments whose value is at least partly derived from one or more underlying equities. The NSE enjoys a virtual monopoly in equity derivatives with daily average volumes at Rs 10,000 crore in the spot segment. In comparison, the BSE has daily average volume of just Rs 4,000 crore. The NSE’s daily average volume in derivative segment is Rs 40,000 crore.