NCDEX Q3FY26 Results: A Mixed Bag of Challenges and Strategic Opportunities

National Commodity & Derivatives Exchange Limited (NCDEX) has released its financial results for the third quarter of FY26 (ended December 31, 2025), showing signs of operational improvement despite continued losses. The company is at a crucial juncture as it pivots toward new business segments while dealing with ongoing commodity trading suspensions.

A) Key Financial Highlights at a Glance

Q3FY26 Performance: 

1. Total Income: ₹24.46 crore (up 79.7% from Q2FY26)

2. Revenue from Operations: ₹6.47 crore (up 14.9% QoQ)

3. Other Income: ₹17.99 crore (up 125.4% QoQ)

4. Net Loss: ₹8.50 crore (improved from ₹11.82 crore loss in Q2FY26)

5. EPS: ₹(0.98) - better than ₹(2.33) in previous quarter

The numbers reveal a company working hard to reduce losses while managing operational constraints.

B) Quarter-on-Quarter Analysis: Gradual Improvement

Comparing Q3FY26 with Q2FY26 shows positive momentum:

Revenue Growth: Operational revenue grew by nearly 15%, indicating better transaction volumes despite commodity suspensions. The standout performer was Other Income, which more than doubled to ₹17.99 crore.

Loss Reduction: The quarterly loss narrowed by ₹3.32 crore - a 28% improvement. This shows management's focus on cost optimization is bearing fruit.

However, expenses also increased by 14%, driven by a dramatic 561% jump in finance costs (from ₹0.13 crore to ₹0.86 crore), signaling increased borrowing or leverage.

C) Year-on-Year Comparison: Fighting Back

When we compare Q3FY26 with Q3FY25, the picture is encouraging:

1. Revenue from operations: Up 10.8% to ₹6.47 crore.

2. Total income: Nearly doubled (up 138.6%).

3. Net loss: Reduced by ₹3.87 crore (improved from ₹12.37 crore to ₹8.50 crore)

The exceptional growth in Other Income (up 307.9% YoY) has been crucial in offsetting operational challenges. This includes ₹2.48 crore from income tax refund interest.

D) Nine-Month Performance: The Reality Check

The 9MFY26 vs 9MFY25 comparison reveals the bigger picture:

9MFY26 Results: • Revenue from operations: ₹17.86 crore (down 6.5% from previous year) • Total income: ₹50.61 crore (up 46.7%) • Net loss: ₹30.20 crore • Negative EPS: ₹(4.80)

The Catch: In 9MFY25, NCDEX reported a profit of ₹8.61 crore, but this was largely due to exceptional income of ₹52.55 crore (refund from Core Settlement Guarantee Fund). Without this one-time gain, the operational performance in 9MFY26 actually shows improvement.

The decline in operational revenue (-6.5%) is concerning and reflects the impact of commodity suspensions on core business activities.

E) The Big Move: ₹770 Crore Capital Raise

In October 2025, NCDEX raised ₹77,000 lakh (₹770 crore) through a preferential issue of 3.90 crore equity shares at ₹197.34 per share. This is a game-changer.

Purpose: The funds are earmarked for entering the Equity and Equity Derivatives segment - a strategic diversification away from commodity-only trading.

Status: NCDEX has received in-principle approval from SEBI to launch this new segment. As of December 2025, ₹3.41 crore has been deployed, with the remaining funds parked in mutual funds and fixed deposits.

This move could potentially transform NCDEX's business model and revenue streams in coming quarters.

F) Major Challenges Holding Back Growth

1. Commodity Suspensions: Trading in key commodities like Chana (chickpeas) and Rapeseed-Mustard has been suspended since August 2021, now extended till March 31, 2026. This has significantly impacted trading volumes and revenue.

2. Rising Costs: Total expenses increased by 15.1% in 9MFY26, with employee costs up 14.6% and finance costs nearly doubling (up 89.8%).

3. Labour Code Impact: The new Labour Codes implemented in November 2025 resulted in a ₹2.06 crore exceptional expense related to gratuity and leave liabilities.

4. Operational Losses: Despite improvements, the company remains loss-making in core operations, heavily dependent on Other Income to reduce overall losses.

5. Declining Transaction Revenue: The 6.5% drop in operational revenue over nine months indicates reduced market activity on the platform.

G) What's Working in NCDEX's Favor

• Deferred Tax Assets: ₹37.71 crore in DTA provides future tax benefits when the company returns to profitability.

• Strong Capital Base: With ₹770 crore freshly raised, NCDEX has the financial muscle to invest in new technology and business segments.

• Diversification Strategy: The planned entry into equity derivatives opens up a much larger addressable market compared to commodity trading alone.

• Regulatory Support: SEBI's in-principle approval for equity segment and mutual fund platform shows regulatory confidence in NCDEX's expansion plans.

H) The Road Ahead: Transition Phase

NCDEX is clearly in a transition phase. The next 12-18 months will be critical:

1. Short-term Focus: Manage costs, optimize operations, and successfully launch the equity derivatives platform.

2. Medium-term Goals: Achieve operational profitability by leveraging new revenue streams from equity trading while hoping for commodity suspension to be lifted.

3. Key Risk: If commodity suspensions continue beyond March 2026 and the new equity segment doesn't gain traction quickly, the company could face prolonged losses.

I) Final Takeaway

NCDEX's Q3FY26 results show a company making gradual operational improvements but still struggling with external constraints. The quarter-on-quarter progress is encouraging - losses are narrowing and revenue is growing modestly.

However, the real story is about transformation. With ₹770 crore in fresh capital and regulatory approvals for new business lines, NCDEX is betting big on diversification. The success of this strategy will determine whether the exchange can break out of its current loss-making cycle.

For investors, NCDEX presents a turnaround story with both potential and risks. The operational improvements are real but incremental. The strategic shift into equity derivatives could be transformational - but execution will be everything.

The next few quarters will reveal whether NCDEX can successfully pivot from a commodity-only exchange struggling with suspensions to a multi-asset platform with sustainable profitability.