Commodity Derivatives

BSE Investments acquires 24% stake in CDSL Commodity Repository

Leading stock exchange BSE today said its subsidiary BSE Investments has acquired 24 per cent stake in CDSL Commodity Repository Limited (CCRL), a move aimed at developing a robust framework for clearing and settlement of commodity trades. As per the rules, BSE cannot take direct stake in any unrelated business and hence the stake is being taken through its subsidiary. “BSE Investments Ltd, a 100 per cent subsidiary of BSE acquired 24 per cent stake in CDSL Commodity Repository Ltd,” the exchange said in a statement.

Asia’s oldest stock bourse, which believes in creation of market infrastructure institutions for development of various markets, said that CCRL will help in transforming commodity markets by creating electronic negotiable warehouse receipts, with an aim to develop a robust.

Besides, CCRL will enable electronic accounting of commodities, thereby ensuring ease of use, accuracy and lower costs for document transmission. The commodity repository will also provide the legal and regulatory environment for inventory financing and warehouse receipt lending.

“We are delighted to partner with CCRL to provide a repository for commodities that will support regulatory reporting requirements for development of the commodities derivatives in India. We believe this partnership will further strengthen our quest of developing and strengthening commodity markets in India,” BSE MD and CEO Ashishkumar Chauhan said.

Regulated by the Warehouse Development and Regulatory Authority (WDRA), CCRL will record the storage and transfers of commodities including warehouse receipt transfers, although deliveries are in physical form.

It is similar to the way depositories function for equities and other financial securities. A trade repository is another important step forward in improving regulatory transparency in the commodity derivatives markets in the country.

Earlier in June, commodity bourse MCX had announced acquisition of 24 per cent stake in CCRL. PTI SP MR MR 08012008 NNNN

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