00:00Ashish, where does commodities derivatives trading fit into the space as well?
00:04Because I know this is an area that you're looking at and it's gaining in popularity in India.
00:08What are you doing here?
00:09In commodities, we actually have a very nice product on natural gas and crude oil products.
00:20We also have launched Indian prices based products, but we have already seen prices based products and they are picking
00:27up quite well.
00:28It's early days, around three years since we launched, and we have gained substantial market share as of now from
00:35specific exchanges which only trade commodities.
00:39And now because we service 130 million unique investors and 270 million accounts compared to the smaller exchanges which actually
00:48service only miniscule number of people,
00:50I think broadly we will have a better future in that, as well as the fact that the foreign portfolio
00:57investors are being allowed into the commodities markets which are already connected to NSE and NSE's clearinghouse.
01:04I hope many of them will select NSE as a venue of choice for trading in commodities derivatives also.
01:11Ashish, I have two very quick questions.
01:13We're a little bit short on time, so very quick questions on do you expect, you know, any kind of
01:19further tamping down by the regulator on speculative activity in the derivatives market as a result of which your volumes
01:25may shrink?
01:26And connected to that is what we've seen also happen in the closing auction space, very controversial, hurting volumes across
01:33the board.
01:34What do you make of when that gets resolved in some fashion?
01:37Are you working with the regulator?
01:39I know they've put out a discussion paper, but are you working to see that, you know, sort of that
01:44becomes more streamlined?
01:47In terms of the derivatives, the strengthening of regulatory measures, it started around 22-23.
01:55The cycle has been fully run.
01:58NSE had literally a daily expiry of weekly options, which has been made into once a week.
02:04Of course, other people also have been given another part of the week.
02:09So broadly, for me, that was the largest sort of issue in terms of sort of losing market share a
02:16little bit.
02:17But it's coming back now over the last few months.
02:20And for me, the cycle of the derivatives tightening is broadly run.
02:26Of course, there might be some minor things here and there that may come about.
02:30We have also been talking or the regulators have been talking about measures on who can participate well in this
02:39market
02:39because there has been kind of concerns about people losing money, especially the smaller investors,
02:45and how to sort of create frameworks to stop them from participating or at least reduce their participation.
02:51So those kind of things will happen.
02:53But if you look at almost 95% of NSE's turnover in derivatives come from only 400,000 people.
03:03And they are professional traders.
03:05They are well-equipped.
03:07They are well-capitalized.
03:08They are also highly educated.
03:09And if you take around 600,000 people, it will be 98% of NSE's total derivatives trading volume.
03:18The remaining around 2 million people are basically trading only less than 2%.
03:23So effectively, NSE has slowly diversified and focused on what I call high-quality investors over the last three years
03:30since the derivatives tightening happened.
03:32And on the closing auction association, I think it's available across the world.
03:37So we took the decisions based on the international investors and also some of the local large investors,
03:42actually ETFs sort of request.
03:45And now it is being re-looked at basis.
03:47So you're in favor of what has happened?
03:49Ashish, you're in favor of what has happened?
03:52For me, I'll tell you, it's not for me to take sides.
03:57It's for me to just implement what the regulators want.
03:59And that would be the process.
04:01I mean, you've seen me like 30 years.
04:04Both of us have seen each other.
04:05I have always worked with the regulators.
04:08Whatever they want, we will do.
04:09If they want to change for increasing the participation of retail traders
04:15by increasing sort of changing those closing association, be it.
04:19And we should actually support whatever the regulators want.
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