Volume Buzzer: IEX Share Price Rallies Over 10%; Reasons Behind the Rally Explained

During the hearing, counsels representing the parties sought additional time, following which APTEL scheduled the next hearing for January 9. The tribunal observed that the matter could be closed if CERC communicates a possible withdrawal of the market coupling order before the next hearing.

CERC informed APTEL that it would need to consult internally before taking a decision on withdrawal. The regulator stated that its objective was to make the coupling framework more consultative, fair, and transparent, and that it would seek instructions from its members before arriving at a final position.

Strong Observations from APTEL

APTEL made strong remarks during the proceedings, noting that it had been informed the market coupling regulations were allegedly framed to benefit certain officers financially. The tribunal expressed concern over what it described as excessive “theatrics” surrounding the formulation of the regulations, stating that such an important regulatory change could have been implemented more discreetly.

Highlighting the importance of regulatory integrity, APTEL said it expects CERC to remain “above suspicion, like Caesar’s wife.” The tribunal added that if any irregularities are found, it would be inclined to examine the matter and take action to prevent similar issues in the future.

IEX argued that even without considering the Securities and Exchange Board of India’s (SEBI) findings related to insider trading, the market coupling order itself is fundamentally flawed and should be set aside.

Background to the Case

In a previous hearing held on November 28, 2025, APTEL had expressed concern over serious allegations made during arguments, noting that if substantiated, they could cast doubt on the functioning of an independent regulator. The tribunal had emphasised the need for an early hearing, preferably before the regulations are formally notified.

IEX’s Petition

IEX has approached APTEL seeking to quash CERC’s market coupling order and has requested an interim stay until the final disposal of the case. The exchange contends that the order is arbitrary, violates principles of natural justice, and would lead to a loss of market share without delivering any meaningful benefits to the power market.

The petition further states that the order disrupts a regulatory framework that has evolved steadily over the past 17 years.

What Are the Market Coupling Norms?

In July 2025, CERC approved the implementation of market coupling under the Power Market Regulations, 2021. The first phase involves coupling of the Day-Ahead Market (DAM), which is scheduled to be rolled out by January 2026.

Under the proposed structure, power exchanges will operate as Market Coupling Operators (MCOs) on a rotational basis. The designated MCO will aggregate buy and sell orders from all exchanges to discover a single market-clearing price applicable across platforms.

Grid India has been appointed as the fourth MCO for backup and audit purposes. It will also develop software for term-ahead market coupling, conduct a three-month shadow pilot, and submit feedback thereafter. Coupling of the real-time market will be considered at a later stage due to the need for further regulatory and operational assessment.

CERC staff are also expected to initiate stakeholder consultations and propose necessary regulatory amendments for DAM coupling.

Why Market Coupling Is Seen as Negative for IEX

The introduction of market coupling is widely perceived as a negative development for IEX, as it dilutes the exchange’s long-standing advantage in price discovery. Currently, IEX commands nearly 85% of the spot electricity market. A uniform pricing mechanism could allow competing exchanges to attract volumes, thereby weakening IEX’s dominant position.

Insider Trading Allegations

During the November 28 hearing, IEX referred to a SEBI report alleging that certain CERC officials were involved in insider trading, leading to illegal gains amounting to ₹173 crore. IEX argued that the market coupling announcement, which triggered a 29% single-day fall in its share price, was part of a broader insider trading conspiracy, adding that SEBI had identified the author of the coupling order.

APTEL had stated that it remains open to examining any allegations of corruption and reiterated that regulators must avoid even the appearance of impropriety.

IEX Q3 Business Update

IEX reported an 11.9% year-on-year increase in electricity traded volumes during the December quarter at 34.08 billion units. However, volumes in the Day-Ahead Market declined 2.8% to 16.25 billion units.

The real-time electricity market delivered strong growth, with volumes rising 35.7% to 12.65 billion units. Volumes in the day-ahead contingency and term-ahead markets increased 29% to 2.54 billion units.

For December 2025, total electricity traded stood at 11.44 billion units, up 2.8% year-on-year. DAM volumes declined 11.6%, while real-time market volumes rose 20.5%. The contingency and term-ahead segments witnessed a sharp 87% surge during the month.

How has IEX’s Share Price Performed?

IEX share price traded around 12% higher near 3:10 pm on Tuesday. 

IEX shares have delivered gains of: 

• 6.48% in the last three months
• 12.18% on year to date basis