IEX shares rise up to 13% on likely APTEL relief on CERC market coupling norms

IEX shares rise up to 13% on likely APTEL relief on CERC market coupling norms

• IEX shares rose 13 percent after APTEL hearing on market coupling norms
• APTEL criticized the coupling order, citing theatrics and possible wrongdoing
• IEX claims the coupling order is wrong and should be set aside

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Shares of Indian Energy Exchange rose up to 13% to Rs 153.5 apiece on January 6 amid Electricity Appellate Tribunal's (APTEL) favourable comments at the hearing on the market coupling norms issued by Central Electricity Regulatory Commission (CERC).

CNBC-TV18 reported that APTEL observed, "We were told that this (coupling order) was done only for some officers to make money. Saw a lot of theatrics in making of these (coupling) regulations."

Market coupling is an economic model used in energy markets to create a single, uniform price for electricity across different trading platforms or exchanges, diluting IEX's dominant position.

IEX counsel said, "Even without SEBI findings of insider trading, coupling order is wrong, and needs to be set aside."

The tribunal questioned how the market coupling rules were formulated. APTEL remarked that CERC should have acted independently while drafting the framework.

"The theatrics are a cause of concern; regulation could have been done quietly by CERC. Expect CERC to be independent and above suspicion like Ceaser’s wife. If there is something amiss, we'd like to enquire and take action to avoid a repeat," the tribunal further observed, reported CNBC-TV18.

On January 6, IEX stock closed 9% higher at Rs 146.8 and was the top gainer on the Nifty Capital Markets index. More than 23.6 million IEX shares traded on January 6, 4x the 30-day average.

No stay has been given by APTEL to IEX. The tribunal has set January 9 for next hearing and could close case on same day.

CNBC-TV18 reported that CERC lawyer said, "We will have to consult and seek instruction on withdrawal of the order. We wanted to make the coupling order more consultative, fair and transparent. Will take up the issue with CERC members, will take instructions on withdrawal of the coupling order."

IEX shares also rose on January 6 as the total electricity trade volume at the exchange in October-December rose 11.9% to 34.08 billion units.

During the quarter, the exchange traded 18.63 lakh renewable energy certificates (RECs), recording a 29.8% year-on-year decline, IEX said in a statement.

What are CERC coupling norms?

In July 23, 2025, CERC issued directions for implementing Market Coupling under the provisions of the Central Electricity Regulatory Commission (Power Market) Regulations, 2021. The implementation of this mechanism was expected to negatively impact the trading volumes on IEX, following which the stock fell 30% the next day.

There are two modes of trading on power exchanges: the real-time market (RTM) and the day-ahead market (DAM). According to a CERC order, starting January 2026, Grid-India will aggregate energy prices across all power trading platforms and publish a single unified price, a process known as day-ahead market coupling. The order said this mechanism would improve the efficiency of power exchanges and strengthen market participants’ confidence in exchange operations.

At present, electricity trading takes place on the market leader IEX, Power Exchange of India, and Hindustan Power Exchange of India. IEX dominates the market with an overall share of about 85% and a near-total presence in key segments such as DAM and RTM. Currently, buyers and sellers place bids independently on each exchange, resulting in separate price discovery across the three platforms.

With market coupling, a single market-clearing price will apply across all exchanges. The exchanges will only gather bids and forward them to a designated agency responsible for determining the common price. As a result, market coupling removes the advantage of trading on the dominant exchange, as bidders would have little incentive to prefer IEX over the other platforms.

IEX insider trading

In October 2025, SEBI barred eight entities from the securities markets and impounded illegal gains of Rs 173.14 crore made by them through insider trading in the shares of IEX.

"I am of the prima facie opinion that the noticees (eight entities) had access to the UPSI pertaining to the CERC order, and based on the trading pattern of the noticees, an irresistible inference can be drawn that their trades, being insiders, were influenced by the possession of UPSI," SEBI Whole-Time Member Kamlesh Varshney said in his 45-page interim order.

Sebi noted that "humongous alleged ill-gotten gains have been made by these entities by executing trades with great precision and timing and at the cost of innocent investors who had no prior access about the impending fall in the price owing to the CERC order".