NCDEX taps TCS to build equities platform, targets cash launch by 2026

India’s largest software exporter will build the necessary IT systems for NCDEX to launch the equity cash segment by end-2026 and the equity derivatives segment by March 2027.

“We have appointed TCS as our technology vendor,” said Arun Raste, MD and CEO, NCDEX. Mint . “We will launch equity cash by the end of the current calendar year and equity derivatives by the end of the next financial year (FY27).”

TCS was selected after a four-month process that also included Nasdaq, London Stock Exchange Group and Swiss-controlled Aquis. TCS shares closed down 2.11% ₹2,692.2 per person on Friday. The company is also the technology supplier of MCX, the country’s largest metals and energy exchange.

NCDEX received approval from the Securities and Exchange Board of India (Sebi) early last year to launch equity cash and equity derivatives segments.

NCDEX to finance new platforms and related services ₹770 crore through preferential allocation to 61 investors in September last year. Investors included Kotak Life Insurance, JM Financial, high net worth individuals like Madhu Kela and Ramesh Damani, stockbrokers like Share India and Globe, and high-frequency foreign traders like Optiver and Citadel.

Raste, with a 40 per cent preferential issue, National Stock Exchange (NSE) holding 15 per cent stake and Life Insurance Corp holding 11.1 per cent stake. He said existing investors, including (LIC) and Nabard, had reduced their holdings to less than 10 per cent.

Indian exchanges offering commodity derivatives other than NCDEX include MCX, National Stock Exchange (NSE) and BSE. India’s commodity derivatives turnover ₹568 trillion in FY25, when MCX had 99.5% market share, according to Sebi data.

Interest in launching an equity derivatives platform gained momentum after Sebi in October last year limited the expiration date of weekly equity index options to one per exchange, compared to multiple expirations earlier. Since September this year, exchanges have been allowed to choose one of two expiration days: Tuesday or Thursday.

While NSE preferred to expire on Tuesday, BSE moved from Tuesday to Thursday in September, intensifying competition for new participants seeking market share in stock index options.

“NSE-backed NCDEX has raised funds to launch new equity cash and derivatives segments in the hope that some IPO-bound companies can list on its new platforms. It’s like an annuity business where listing fees are different for companies. ₹3 lakhs ₹4 lakh a year,” said a broker.

NCDEX became operational in 2003 after the Atal Vajpayee-led National Democratic Alliance government restarted commodity derivatives trading after a four-decade ban. The exchange is currently seeing strong deliveries in the spice and guar complex and plans to restart contracts for pepper and potato derivatives.

In 2007, trading in pulses and rice futures was banned by the United Progressive Alliance government following sharp price increases resulting from supply constraints.