IEX Q1 results: Stock nosedives 28% ahead of earnings as market coupling order spooks investors

Market coupling is an economic model used in energy markets to create a single, uniform price for electricity across different trading platforms or exchanges.

The regulator's move is aimed at improving price discovery and system efficiency.

The Central Electricity Regulatory Commission (CERC) said in an order that the day-ahead market segment of all power exchanges will be coupled using a common system.

The implementation of a market coupling model could reduce the IEX's dominance in price discovery and affect its market share, as currently, the Indian Energy Exchange is the country's most prominent platform for electricity spot price discovery.

The new move is also expected to hit the revenue of IEX.

Under the new system, power exchanges will take turns acting as the market coupling operator. Grid-India will serve as a backup and audit operator.

The CERC said it would issue further orders based on the progress of implementation.

With the introduction of market coupling, other power exchanges will also act as market couplers.

IEX Q4 FY25 Results

Indian Energy Exchange (IEX) posted a rise of over 21% in consolidated net profit to ₹117.11 crore in the March quarter of FY25 compared to a year ago, mainly on the back of higher revenues.

It had reported a consolidated net profit of ₹96.68 crore in the quarter ended on March 31, 2024, a regulatory filing showed.

Total income in the reporting quarter rose to ₹174.59 crore from ₹149.28 in the same period a year ago.

During the 2024-25 fiscal year, the consolidated net profit of the company rose to ₹429.16 crore compared to ₹350.78 crore in the preceding financial year.