Shares of Multi Commodity Exchange of India (MCX) gained nearly 3% in early trade on Monday after SEBI Chairman Tuhin Kanta Pandey indicated that the regulator is open to allowing foreign portfolio investors (FPIs) to participate in options trading in commodity derivatives.
MCX was trading at ₹2,514.70, up 2.92%, with the stock hitting an intraday high of ₹2,525. The move comes after the SEBI chief, in an interview to the media, said that commodity derivatives have not been looked at in a proactive manner for some time and that the regulator is examining steps to deepen the segment.
Pandey said SEBI will “see allowing FPIs in options trading in commodity derivatives soon,” adding that the framework will be based on detailed work carried out by a working group. He clarified that the group’s deliberations will first be presented before the Commodity Derivatives Advisory Committee, following which a consultation paper will be issued.
“The way in which we allow will be based on deep work done by the working group,” he said, indicating that any move would be calibrated and supported by appropriate guardrails.
The comments have been viewed as structurally positive for MCX, India’s leading commodity derivatives exchange, as permitting FPIs into commodity options could significantly expand participation, improve liquidity and enhance price discovery in segments such as metals, energy and bullion.
At present, FPI participation in commodity derivatives is limited. Expanding access to options — especially if structured with clear position limits and risk controls — could provide a fresh growth trigger for trading volumes on the exchange.
Market participants will now watch for the release of the consultation paper and the specifics of the proposed framework to assess the potential impact on MCX’s volumes and earnings outlook.