Indian operations unaffected by global news: MF Global

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MF Global Holdings, the futures broker, has filed for US Chapter 11 bankruptcy protection . MF Global Holdings owns USD 6.3 billion of Italian, Spanish, Belgian, Portuguese and Irish debt.

However, speaking to CNBC-TV18, Vineet Bhatnagar, managing director of MF Global Sify Securities, the Indian arm of the US brokerage said that Indian operations are not disrupted due to global news.

"MF Global Sify Securities which is the broker dealer on the Indian stock exchange remains a financially strong counter party and broker dealer. There is no liquidity stress or insolvency related issues that we have noticed," he added.

Further, MF Global Sify Securities is not looking to offload stake and is not in talks with anyone for the same.

Below is the edited transcript of Bhatnagar's interview with Udayan Mukherjee and Mitali Mukherjee of CNBC-TV18. Also watch the accompanying video.

Q: What does it mean for the India operations? Will it continue to function or will it look for another buy to take out the India asset?

A: It continues to operate on a business as usual status. The MF Global Sify Securities which is the broker dealer on the Indian stock exchange remains a financially strong counter party and broker dealer. There is no liquidity stress or insolvency related issues that we have noticed.

We have been interacting with our regulators and exchanges very closely. We have shared with them all the developments as well as the internal assessment of our liquidity and strength. There is no reason that we see that can disrupt the business of India for both local stock exchange and commodities futures exchange.

Q: There have been some reports that some brokerages have been looking to put in a bid for MF Global and to acquire it. Are you actively in discussion with any brokerages? Is that an option that's on the table right now?

A: No. As far as the India management is concerned, we are not in discussion with anybody. One must recognise that MF Global's stake of 70% in MF Global Sify is one which is portfolio ownership of sorts.

If there is a situation where the receivership in the US results in a process where this 70% ownership in India asset does come for a change of hand then it would happen. I would imagine that this is a very well supervised process in the US.

Q: There are also reports that Sify maybe looking to up its stake from the current 30% to about 50%. Is that being considered?

A: I am not aware about this particular discussion. I would only submit that under the shareholders agreement that is presently there between MF Global and Sify Securities. Sify has the flexibility to weigh all its options. I would not be aware of the development that you just talked about.

Q: Just to narrow down on the market impact of it, in India you are just a broker dealer, you have no assets under management, which would require any sales being pressed because of winding up operations in the US, right?

A: Absolutely. We are a pure agency broker in India. We do not have any outstanding proprietary position and assets under management.

Q: A quick view on the market as well for the November series since business us running as usual?

A: Yes indeed. These are the early days for November series so I should wait for some more data to be made available so that we can infer. But as October was coming for expiration, there was a change in sentiment. Post Diwali was a strong open for Nifty. At this point in time there is a possibility that 5,200-5,400 remains trading range for Nifty