Shares of India Energy Exchange (IEX) staged a sharp rebound on Friday, surging over 12% in early trade even as broader equity markets tumbled. The stock climbed as much as 12.11% to close at ₹148.50 apiece on the BSE, recouping some of the heavy losses it suffered in the previous session.
Background: Steep Decline on July 24
On Thursday, July 24, IEX shares plunged nearly 30%—their worst single‑day drop on record—and marked a seventh straight session of decline. The sell‑off followed a decision by the Central Electricity Regulatory Commission (CERC) to implement market coupling from next year, a move that investors feared could intensify competition and pressure transaction volumes on the exchange.
Strong Q1 FY26 Performance
Despite regulatory headwinds, IEX delivered robust quarterly results after market hours on Thursday, which helped fuel Friday’s recovery:
- Net Profit: ₹120 crore in Q1 FY26, up 25% YoY from ₹96 crore a year ago.
- Revenue: ₹184.2 crore, a 19% increase from ₹154 crore in Q1 FY25.
- Electricity Volumes: Rose 15% YoY to 32.4 billion units.
- Renewable Energy Certificates (RECs): Trading jumped 149.3% YoY, with 52.7 lakh certificates exchanged.
- Day‑Ahead Market (DAM) Liquidity: Supply rose 45.2% YoY; average DAM price fell 16% to ₹4.41 per unit.
- Real‑Time Market: Average price declined 20% to ₹3.91 per unit.
These figures suggest that while average transaction prices have eased—likely due to improved supply and competition—overall volumes and alternate revenue streams like REC trading are on the rise.
Technical Outlook: Caution Ahead
Anshul Jain, Head of Research at Lakshmishree Investments, warns that the stock’s bounce could be short‑lived unless it reclaims key support levels. “IEX has broken below the lower end of its 39‑week trading range at ₹158, signaling the start of a potential bearish phase,” Jain notes.
- Key Level: A sustained weekly close above ₹158 is needed to invalidate the breakdown.
- Downside Target: If selling pressure continues, the stock could test ₹112, a long‑standing swing‑low support.
Without a quick recovery above ₹158, Jain expects a “sell‑on‑rallies” pattern in the near to medium term.
Share Price Performance Over Time
- One Month: Down 22%
- Six Months: Down 13%
- Year‑to‑Date: Down 18%
- One Year: Down 16%
- Two Years: Up 20%
- Five Years: Up 153%
This mixed performance profile shows that while IEX has delivered strong long‑term returns, recent months have been challenging amid regulatory changes and broader market volatility.
What This Means for Investors
- Short Term: The bounce on Friday reflects relief over strong Q1 results. However, investors should watch ₹158 as a critical technical level.
- Medium to Long Term: If CERC’s market‑coupling framework boosts overall power market efficiency, transaction volumes on IEX could benefit. Conversely, heightened competition may compress margins.
At 9:35 AM on Friday, IEX shares were trading 12.04% higher at ₹148.40 on the BSE, underlining the market’s focus on fundamentals over temporary regulatory concerns.
Disclaimer: Views and recommendations in this article reflect those of individual analysts and brokers, not Mint. Please consult certified experts before making investment decisions.
