Dubai: Gaurang Desai, the chief executive officer at Dubai Gold and Commodities Exchange (DGCX), has a two-pronged strategy to re-define priorities as it readies for the next wave of growth.
“DGCX is working on a two-pronged strategy on how to expand its membership base, and also the product offering that the exchange can provide them,” Gaurang Desai, Chief Executive Officer at DGCX told Gulf News, adding that “the focus now is on the wide range of players.”
“For any market to develop, the richness of variety of clients is critical. We also want to involve banks, corporate houses including arbitragers, hedgers, traders and investors. Our focus in the past 12 months have been on this, and our priorities have been re-defined.”
The exchange is looking to synergise with the diamond community, along with gold traders, and corporate and regional bases in the Jebel Ali Free Zone, and the DGCX is working with each of them and link them with regionally relevant products.
“This would offer more incentives for people to trade and to keep the money in the region,” he said, adding “when we have multiple relevant products on the exchange, one need not access multiple exchanges across borders, which otherwise results in inefficiencies and costs.”
The exchange currently has about 250 members and offers platform to trade in four assest classes, which includes precious metals, currencies, hydrocarbons, and equities.
Desai, who owes his success to ethics, integrity and hard work and believes that they have no alternatives, was formally appointed as the new chief executive officer in August 2015 after serving as an interim CEO for more than a year.
Spot gold:
The DGCX has been talking to various commercial banks in the region, and also bullion traders and is in advanced stages, and plan to launch the spot gold contract by year-end.
This launch is aimed to set a benchmark Loco Dubai price for all stakeholders in China, India, and Africa etc. China and India consumes more than 1,500 tonnes, which is equivalent to nearly half of the world gold supplies coming mainly from China, Australia, United States and Russia.
“The focus has been that we involve the entire eco system together, so not only our members, but also gold souk physical traders, our vaults and refiners, and make sure they are ready and they understand the value proposition that we are bringing together,” Desai said.
On October 9, the exchange plans to launch India silver Quanto and mini WTI. The exchange is also looking to launch Chinese Yuan before the year-end in addition to the 10 currency pairs it already offers, as part of its strategy to offer regionally relevant products from global investors, globally relevant products for regional investors. The exchange is also looking to explore Turkish Lira, sub-continental currencies from Pakistan, Bangladesh. The exchange is also planning to expand its equity space.
The year 2016 would be a year of marketing and transformation, and reach out to their members.
Doubling volumes:
All these products would help the exchange to register stellar performance on volumes front.
“Volumes would continue to grow. As the mix deepens, we would want our volumes to grow 100 per cent on year basis,” Desai said, adding “we are targeting for that and we are confident that we would meet our targets.”
From the current product portfolio, DGCX’s volumes grew 32 per cent in the September quarter, while the precious metals volumes have grown more than 40 per cent. The G6 currencies excluding Indian rupee grew by 36 per cent in the September quarter.
