This is another rag to riches story, but the founder of MCX the newest stock exchange in India enriched himself as a byproduct and has made thousands of people, and society itself to create massive wealth.
Jignesh Shah studied at the University of Mumbai and did his Electronics Engineering. After his brief stint in the BSE, the behemoth in trading he went on to fill the institutional voids which we talk about so much in Emerging Economies.
MCX replaced the age old regional commodities exchange prevalent in various states and unified them by providing a nationwide electronic trading platform for futures trading in both agricultural products and metals.
The going was tough, but Jignesh Shah fought all odds by taking on the BSE and the NSE. He had to run behind bureaucrats and RBI officials before he got the official nod to start MCX. Today, MCX is a powerful brand and the revenues are growing at a huge rate. Started only in 2008 it has become one of the most powerful brands in the trading space.
Jignesh Shah has also been approached by many foreign countries to start an exchange looking at the success of MCX. The identification of an institutional void is paramount and he reaped benefits by filling that void.
At the end of June 2012, MCX-SX had 750 members and saw participation from 707 towns and cities across India. Adhering to its philosophy of ‘Systematic Development of Markets through Information, Innovation, Education and Research,’ MCX-SX’s mission has been to promote Financial-literacy-for-Financial InclusionTM, as is envisaged by the Government of India. MCX-SX till date has conducted more than 1300 investor education programmes across the country, averaging almost one such programme per working day.
The FMC, which regulates commodity exchanges, said the turnover in the bullion segment rose more than two-fold to Rs 87.58 lakh crore during the April-January period of the 2011-12 fiscal from Rs 42.91 lakh crore in the corresponding period last year.
In a similar fashion, business from agri-items like guarseed increased by 52 per cent to Rs 16.95 lakh crore from Rs 11.14 lakh crore.
While the turnover of energy items like crude oil increased by 32 per cent to Rs 24.23 lakh crore from Rs 18.38 lakh crore, business from metals like copper rose marginally by 6 per cent to 23.11 lakh crore from Rs 21.82 lakh crore during the review period.
During January 2012, the maximum turnover of Rs 12, 20,860 crore was posted by MCX.
MCX has got a great future ahead of it as the commodities market is bigger than the equity market and other Emerging economies can follow this model to ease transactions and by developing model institutions to monitor these transactions.
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written by Santosh Krishnan (santosh.pgdm14c@greatlakes.edu.in)
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