63 Moons Technologies, formerly known as FTIL, will invest Rs 50 crore every year for the next three years in its subsidiary, the National Spot Exchange (NSEL). FTIL had come under the regulatory scanner few years ago after NSEL defaulted for Rs 5,574 crore. 63 Moon Technologies holds 99.99 per cent stake in NSEL. The former has sought shareholders’ approval for the move.
The company’s note to the shareholders said that NSEL was going through a challenging time since the unfolding of the NSEL payment crisis on NSEL trading platform in July 2013.
The subsidiary is defending itself in various legal, recovery and other related matters associated with settlement default by some members, occurred on the exchange platform in 2013-14. “Under current status of NSEL, it has no ability to raise resources from outside on its own as there is no revenue generation activity in NSEL,” said in the note.
The subsidiary has requested for financial support to recover the money from defaulting members, to defend various legal cases against various parties to recover amount from defaulting parties and for working capital.
According to 63 Moons Technologies' 2015-16 annual report, its legal and professional charges were Rs 58.06 crore as compared to Rs 71.47 crore, a year ago.