LIC Portfolio Stock: Share Price Locks in Lower Circuit at 52-Week Low as CERC Approves Market Coupling by January 2026

DSIJ Intelligence-2 / 24 Jul 2025/ Categories: Mindshare, Trending

LIC Portfolio Stock: Share Price Locks in Lower Circuit at 52-Week Low as CERC Approves Market Coupling by January 2026

The stock price fell sharply on July 24, tumbling as much as 23 per cent to Rs 144.66, marking a new 52-week low

Indian Energy Exchange (IEX) shares fell sharply on July 24, tumbling as much as 23 per cent to Rs 144.66, marking a new 52-week low. The sharp decline followed the Central Electricity Regulatory Commission’s (CERC) announcement that market coupling for India’s power exchanges will be implemented by January 2026. The order came just hours before the company’s Q1 FY26 Quarterly Results, raising concerns about IEX’s earnings visibility and future market dominance.

CERC’s directive specifies that market coupling will begin with the Day-Ahead Market (DAM), the largest segment of the power exchange market, using a round-robin mode. Real-Time Market (RTM) coupling will be considered later after assessing operational experience with DAM. The framework aims to enhance uniform price discovery, maximise transmission line usage, and increase overall market efficiency.

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Market coupling, widely adopted in international energy markets, pools bids from multiple exchanges and clears them centrally to create a single uniform electricity price. While this mechanism aims to improve operational efficiency, it shifts price-setting power away from individual exchanges like IEX to the Grid Controller of India, potentially impacting trading margins.

IEX currently holds over 90 per cent share in both DAM and RTM. In FY24, DAM volumes exceeded 73 billion units, while RTM reported a 19 per cent year-on-year growth. These segments are critical to IEX’s revenue and profitability, with its competitive advantage largely based on efficient price discovery. Under the new centralised system, this advantage may diminish, pressuring margins and future earnings growth.

On the trading day, IEX initially hit its 10 per cent lower price band at Rs 169.10 before extending losses to Rs 144.66. The development underscores rising investor concerns about the company’s business model sustainability and profitability in a coupled market structure.

Disclaimer: The article is for informational purposes only and not investment advice.