Brokerage Jefferies estimates the National Stock Exchange’s Electronic Gold Receipts (EGR) business could reach ₹1,260 crore in annual revenue by FY30. This projected growth depends on increased trading volumes and the planned expansion of the exchange's network of physical collection centers.
The National Stock Exchange (NSE) is actively expanding its Electronic Gold Receipts (EGR) business, a segment that brokerage firm Jefferies projects could generate ₹1,260 crore in annual revenue by fiscal year 2030. This growth estimate is linked to the exchange’s strategy to establish a centralized spot market for bullion in India, modeling its approach on the Shanghai Gold Exchange.
Product Mechanics and Market Adoption
The primary appeal of EGRs compared to existing investment options like gold exchange-traded funds (ETFs) or Sovereign Gold Bonds (SGBs) is the feature that allows investors to convert their digital holdings into physical gold. This capability is intended to attract investors who prefer the tangibility of physical assets but want the transparency and security of an exchange-traded platform. However, investors should note that a 3 per cent goods and services tax (GST) is applicable at the time of converting these receipts into physical gold, which acts as a cost factor that can influence retail demand.
To drive wider usage, the exchange is expanding its physical infrastructure, with a target to establish over 1,000 collection centers in the coming year. Additionally, the management is introducing smaller-denomination receipts to lower the entry cost for smaller retail participants, aiming to make the product more accessible.
Diversification Across Business Segments
Beyond its gold business, the exchange is focusing on growth in its commodity derivatives and mutual fund order platforms. The commodity derivatives segment, supported by the performance of WTI crude oil contracts, is expected to double its revenue contribution to at least 2 per cent by FY30. Simultaneously, the mutual fund order platform is expanding its reach through fintech partnerships, with market share expectations climbing to 35 per cent within four years.
Collectively, these segments—EGR, commodities, and mutual fund platforms—could provide a significant boost to the exchange's profitability, representing over 13 per cent of the firm's projected FY26 profit. While these projections indicate potential growth, the success of the EGR segment will depend on factors such as consumer adoption of digital gold platforms, competition from traditional jewelry markets, and the operational success of physical gold delivery logistics. Investors will likely track the growth in trading volumes, the actual rollout of new collection centers, and how the 3 per cent GST impacts the long-term participation of retail investors.