CO: Commodity trading volume is much higher than that of equities. So do you consider it more safe and best bet for investors?

Manglik: This has to be put in perspective: commodity trading volumes globally are several times that of equities but commodity volumes in India are about one-third of equity volumes. Since currencies have such an overarching effect on commodity prices, that market too can be considered part of the commodities business portfolio and that substantially changes the scenario. I like commodities trading because of advantages of direct linkages with international markets, high depth & liquidity and extended trading hours. Futures trading also allow you to participate and profit when markets rise as well as when markets fall. All these factors make commodities a very secular product to trade and invest in.

CO: What has been Religare’s growth path over the years? What is your USP?

Manglik: Religare’s commodities business has been a major success story in this industry. We have seen our turnover, client base, market-share and profits increase continuously over the last several years. The key reasons for this growth have been a superb team, national reach through our branch network, a strong research desk to support client trading and our internal processes which enable seamless trading for clients. Being number one is a good feeling but we work hard at it. Religare also has a Commodities Corporate Desk which focuses on giving risk management solutions to companies incorporating commodities as well as their currency exposure. We also have a Mandi Desk branded AgriHaat which is a commodity-focused network of 52 branches based in local mandis where physical exchange of agricultural goods takes place e.g. places like Guntur in AP for chillies, Unjha in Gujarat for jeera trading and Chandausi in UP for menthe. Similarly, we have several unique initiatives and these have been a major reason for our success.

CO: Looking at the upbeat mood in the equities market and global economies, what will be your strategy for growth?

Manglik: For commodity business, growth in India is still on the fast track and we are working to expand the category, to grow the market itself. One of the key issues is lack of trained manpower which is being tackled in typical Religare fashion i.e. innovatively. We have tied up with some educational institutions to give in-depth commodity specific training to freshers, who after completing the course are absorbed as Relationship Managers. A 30-day hands-on training in a Religare branch is part of this schedule. We are still growing exponentially in terms of key indicators and I don’t see that changing for now. Also, we are open to all ideas for growth, be it by acquisition or looking at international markets, nothing is ruled out. As a group, we have presence in Asia, Africa, Middle East, Europe and the Americas. In India, which is our largest market, we offer a wide array of products and services and have also pioneered the concept of investment in alternative asset classes. Across all products, we serve over a million clients including corporates, institutions, high net worth families & individuals and retail investors.

CO: What is the growth in your clientele over past one year and target for the next fiscal?

Manglik: Growth is a byword in Religare, we live by it. Our number of commodity clients almost doubled in the last year and we are looking to add several more this year too on the retail as well as the corporate front. Client acquisition is a major focus area for us and we are able to attract such a large number of clients because we are ready to go the extra mile to service their needs. We are consciously responsive and focused on providing the best trading experience to every client. To ensure uniformity in service parameters and consistently high standards, we have an ISO 9001:2000 certification in business operations for commodity broking and trading services since more than two years ago.

CO: What according to you should change in the basic system that can boost commodity Futures trading across all groups?

Manglik: Increased participation is the key. It is imperative that large players be allowed and encouraged to participate. Banks, MFs, FIs and even FIIs should be able to trade and invest in our markets. Commodities are global by nature and India is a large producer and/or consumer on the world stage; therefore we would like the biggest players in the world to participate in our markets. The main idea of having commodity markets here is to become a price-setter rather than a price-taker as is the case currently and all efforts should be towards making that possible. That will be a game-changing value addition from the markets. We will know that we have achieved what we set out to do when we don’t have to go to the markets, the markets will come to us.

CO: How do you see a growing trend of large corporate coming into commodities to hedge?

Manglik: More and more companies are looking at commodity and currency markets for hedging and this segment is only going to increase, just as it is in developed markets. We run a specialized Corporate Desk with our people spread out across the country. This team only focuses on providing risk management solutions to companies who have physical exposure in commodities and / or currency exposure. As you are aware, commodity markets are primarily for the benefit of providing a hedging platform for companies. But there is still an information gap which prevents companies from utilizing the benefits of hedging – our Corporate Desk helps clients plan their hedging program after analyzing their requirements, implement it with hand-holding as necessary and monitor the performance of the hedge with suitable analytics and reports.

CO: Is there any better system than that what is practiced now to have a better price discovery mechanism for farmers?

Manglik: Our commodity futures exchanges MCX, NCDEX, NMCE and ICEX have provided an excellent platform for price discovery as well as risk mitigation. The price guidance from the exchanges should be used as an input in arriving at the Minimum Support Price (MSP). The advent of commodity spot exchanges will also alter the scenario considerably and make the price discovery mechanism even more efficient as farmers are able to make the sale on the spot with immediate delivery. Since the exchanges provide innovation, it is an ideal platform for producers, consumers, traders, investors, arbitrageurs and hedgers. The exponentially increasing client base and volumes is proof of success and just as live exchange prices are being used by jewelers as a benchmark to sell gold, I expect the same to happen with agricultural commodities within a short time.

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