MULTI COMMODITY EXCHANGE OF INDIA LIMITED

IPO

COMPANY BACKGROUND

The Multi Commodity Exchange of India Limited (MCX), Indias first listed exchange, is a
state-of-the-art, commodity futures exchange that facilitates online trading, and clearing and
settlement of commodity futures transactions, thereby providing a platform for risk
management. The Exchange, which started operations in November 2003, operates within the
regulatory framework of the Forward Contracts (Regulation) Act, 1952.

MCX offers trading in varied commodity futures contracts across segments including bullion,
ferrous and non-ferrous metals, energy, agri-based and agricultural commodities. The
Exchange focuses on providing commodity value chain participants with neutral, secure and
transparent trade mechanisms, and formulating quality parameters and trade regulations, in
conformity with the regulatory framework. The Exchange has an extensive national reach,
with over 2100 members, operations through more than 400,000 trading terminals (including
CTCL), spanning over 1900 cities and towns across India.

OBJECTIVE OF THE OFFER

The objective of the offer are to achieve the benefits of listing on the Stock Exchange and to
carry out the sale of 6,427,378 Equity Shares by the Selling Shareholders. The listing of the
Equity Shares will enhance our brand name and provide liquidity to the existing shareholders.
Listing will also provide a public market for the Equity Shares in India. Our Company will
not receive any proceeds from the Offer.

Risk Analysis by the Management

1. There are certain criminal cases pending against our Directors and our Group
Companies.
2. Their Company, Promoter and Group Companies are party to certain legal
proceedings, which could harm our reputation and adversely affect our business.
3. We may face competition from existing players and new entrants in the industry
which could adversely affect our business, financial condition and results of
operations.
4. Their clearing house operations expose us to credit risks with respect to our clearing
members.
5. Their company could be harmed by member misconduct that is difficult to detect.
Any such incidences could result in regulatory sanctions, financial losses and
reputational harm.
6. They could be harmed by employee misconduct or errors that are difficult to detect
and any such incidences could adversely affect our financial condition, results of
operations and reputation.
7. We may not be able to sustain effective implementation of our business and growth
strategies.


Reason for justification of the Issue Price

The Offer Price will be determined by our Company and the Selling Shareholders in
consultation with the BRLMs on the basis of assessment of market demand and on the basis
of the following qualitative and quantitative factors for the Equity Shares offered by the Book
Building Process. The EPS and NAV presented in this section are based on the face value of
Rs. 10 per equity share and have been calculated after giving effect to the consolidation of
shares and bonus issue approved by the shareholders of our Company by resolution dated
March 14, 2011.

Qualitative Factors

Some of the qualitative factors which form the basis for computing the price are:
Leadership Position in the commodity futures industry - The total value of
commodities futures contracts traded on our Exchange in Fiscal 2010 was 82.3% of
the Indian commodity futures industry as per data maintained by FMC.
Experienced Board of Directors and management team
Product and service innovation
Technology infrastructure
Scalable technology platform and business model
Integrated infrastructure and network of alliances

Quantitative Factors

1. Basic and diluted Earnings Per Share (EPS)

Period Basic EPS (Rs.) Diluted EPS (Rs.) Weight age
Year ended March 31,
2010
43.34 43.33 2
Year ended March 31,
2009
31.60 31.44 1
Weighted Average 39.43 39.37 -

2. Comparison of Accounting Ratios

There are no listed companies in India that engage in a business similar to that of our
Company. Hence, it is not possible to provide an industry comparison in relation to our
Company.

Type of issue, Issue Size, price band , face value

Issue Open: Feb 22, 2012 - Feb 24, 2012
Issue Type: 100% Book Built Issue IPO
Issue Size: 6,427,378 Equity Shares of Rs. 10
Issue Size: Rs. 663.31 Crore
Face Value: Rs. 10 Per Equity Share
Issue Price: Rs. 860 - Rs. 1032 Per Equity Share
Market Lot: 6 Shares
Minimum Order Quantity: 6 Shares
Listing At: BSE
Price band of Rs 860 -1,032 per share.


Merchant banker / Lead managers to the issue

Edelweiss Capital Limited
Citigroup Global Markets India Private Limited
Morgan Stanley India Private Limited
Karvy Computershare Private Limited

IPO Grading

CRISIL has assigned an IPO Grade 5 to MCX IPO. This means as per CRISIL, company has
'Strong Fundamentals'. CRISIL assigns IPO grading on a scale of 5 to 1, with Grade 5
indicating strong fundamentals and Grade 1 indicating poor fundamentals.

Bankers to the issue, Registrar.

Registrar to the Issue
INTIME SPECTRUM REGISTRY LIMITED

Bankers to the Company

Bank of India
Citibank N.A.
Corporation Bank
HDFC Bank Limited
The Hongkong and Shanghai Banking Corporation Limited
Kotak Mahindra Bank Limited
State Bank of India
UTI Bank Limited


SEBI guidelines followed for coming out with public issue

Eligibility for the Offer
MCX Company is eligible for the Offer in accordance with the Regulation 26(2) of the SEBI
Regulations, which states as follows:
An issuer not satisfying any of the conditions stipulated in sub-regulation (1) may make an
initial public offer if:
(a) (i) the issue is made through the book building process and the issuer undertakes to allot
at least fifty per cent of the net offer to public to qualified institutional buyers and to refund
full subscription monies if it fails to make allotment to the qualified institutional buyers;
OR
(ii) at least fifteen per cent. of the cost of the project is contributed by scheduled commercial
banks or public financial institutions, of which not less than ten per cent shall come from the
appraisers and the issuer undertakes to allot at least ten per cent of the net offer to public to
qualified institutional buyers and to refund full subscription monies if it fails to make the
allotment to the qualified institutional buyers;
AND
(b) (i) the minimum post-issue face value capital of the issuer is ten crore rupees;
OR
(ii) the issuer undertakes to provide market-making for at least two years from the date of
listing of the specified securities, subject to the following: 411
(A) the market makers offer buy and sell quotes for a minimum depth of three hundred
specified securities and ensure that the bid-ask spread for their quotes does not, at any time,
exceed ten per cent.;
(B) the inventory of the market makers, as on the date of allotment of the specified securities,
shall be at least five per cent. of the proposed issue.

Reservation
Reservation of upto 250,000 equity shares for eligible employees. The offer would constitute
12.60% of the post offer Paid- up equity capital. The net offer would constitute 12.11% of the
post offer Paid- up equity capital.

Data on the Category of investors and reservation

The Company................................................................1,400,000 Equity Shares
The Selling Shareholders..............................................3,600,000 Equity Shares
Of which
FTIL................................................................3,358,000 Equity Shares
Corporation Bank ...........................................242,000 Equity Shares
Total ........................................................................5,000,000 Equity Shares

Business Associates Reservation Portion ....................Up to 250,000 Equity Shares
Employee Reservation Portion ....................................Up to 214,000 Equity Shares
Existing FTIL Shareholders Reservation Portion .......Up to 500,000 Equity Shares
Reservation Portion ...................................................Up to 964,000 Equity Shares

Therefore,
Net Issue to the Public ................................................4,036,000 Equity Shares of which:
QIB Portion ....................................................2,421,600 Equity Shares Of which

Mutual Fund Portion 121,080 Equity Shares
Non-Institutional Portion ...............................Up to 403,600 Equity Shares
Retail Portion..................................................Up to 1,210,800 Equity Shares
Equity Shares outstanding prior to the Issue ...............38,956,825 Equity Shares
Equity Shares outstanding after the Issue ..................40,356,825 Equity Shares

Book building data when the issue was open for subscription

Book building refers to the process of collection of Bids, on the basis of the Red Herring
Prospectus within the Price Band. The Issue Price is fixed after the Bid /Issue Closing Date.
The principal parties involved in the Book Building Process are:
The Company;
The Selling Shareholders;
Book Running Lead Managers;
Syndicate Members who are intermediaries registered with SEBI or registered as
brokers with NSE/BSE and eligible to act as Underwriters. Syndicate Members
are appointed by the BRLMs;
Escrow Collection Banks; and
Registrar to the Issue.

Key steps to be taken for bidding:

Check eligibility for bidding, see the section titled Issue Procedure-Who Can Bid?
on page 189 of this Draft Red Herring Prospectus;
Ensure that the Bidder has a demat account and the demat account details are
correctly mentioned in the Bid cum Application Form;
If the Bid is for Rs. 50,000 or more, ensure that the PAN is mentioned and the copy of
the PAN card is attached to the Bid cum Application Form
Ensure that the Bid cum Application Form is duly completed as per instructions


The Issue price, No. of times each category was subscribed

Issue Price - Rs. 1,032.00 Per Equity Share





Number of Times Issue is Subscribed (BSE + NSE)
As on Date & Time
Qualified
Institutional
Buyers
(QIBs)
Non
Institutional
Investors
(NIIs)
Retail
Individual
Investors
(RIIs)
Employee
Reservations
Total

Shares Offered / Reserved 2,162,083 926,607 2,162,082 250,000 5,500,772

Day 1 - Feb 22, 2012 17:00 IST 0.7400 0.1600 1.5000 0.0000 1.0000

Day 2 - Feb 23, 2012 17:00 IST 3.6800 1.8800 6.9100 0.0500 4.4800

Day 3 - Feb 24, 2012 20:30 IST 49.1200 150.3500 24.1400 0.1800 54.1300


Basis of Allotment

For Retail Individual Bidders
For Non-Institutional Bidders
For QIBs
For Business Associates Reservation Portion
For Employee Reservation Portion
For Existing FTIL Shareholders Reservation Portion





Listing details

BSE
Issue Price: Rs. 1,032.00
Open: Rs. 1,387.00
Low: Rs. 1,282.10
High: Rs. 1,426.00
Last Trade: Rs. 1,297.05
Volume: 6,018,387
NSE

Rs. 1,032.00
Rs. 1,408.00
Rs. 1,282.20
Rs. 1,428.55
Rs. 1,296.70
7,941,567

Price details from the day of listing

Listing Date: Friday, March 09, 2012
BSE Scrip Code: 534091
NSE Symbol: MCX
Listing In: 'B' Group of Securities
Sector: Other Financial Services
ISIN: INE745G01035
Issue Price: Rs. 1,032.00 Per Equity Share
Face Value: Rs. 10.00 Per Equity Share