Apart from spending on creating a data center, NSE is planning to revamp its cloud storage capabilities and also improve the surveillance systems by employing artificial intelligence tools.
Mumbai: The National Stock Exchange(NSE) is planning to move its co-location server away from its headquarters at Bandra Kurla Complex in Mumbai to a third-party data centre. As part of this relocation, the country's largest bourse will also move its primary data centre away from the existing premises.
"With the surging trading volumes, NSE will have to keep adding new servers which require a lot of space," NSE's managing director and chief executive officer Vikram Limaye told ET. "We have decided to set up an exclusive data centre on the outskirts of Mumbai and both the data servers and co-location servers will be moved to this data centre."
In co-location, a system popular with traders using sophisticated trading programmes, stock exchanges allow market participants to set up a server on the exchange premises for a fee. The intention is to allow them to maintain their servers closest to the exchange servers so that allows traders to get to know about stock prices a few milliseconds in advance.
The relocation of the co-location facility is part of a series of special technology projects undertaken by NSE in the past few years. The project is estimated to be finished by this year end and is likely to cost the exchange around ₹1,000 crore.
NSE currently has all the major data centres, except for the back-up site, at its headquarters where the scope for capacity expansion is limited.
The total daily turnover in the futures and options (F&O) segment of NSE surged by over six times from ₹2,375 trillion in FY19 to ₹15,280 trillion in FY22. The average daily turnover in the cash market surged from ₹32,000 crore in February 2021 to ₹58,442 crore in February 2022, official data showed.
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This has prompted NSE to increase its technology spend in the past few years. The exchange's total technology spending including both capital expenditure and operational expenditure went up by nearly ten times from ₹400 crore in FY19 to an estimated ₹4,000 crore in FY23. The FY23 figures also include the ₹1,000 crore spend on special projects.
"In FY19, the total technology spend was just 12-15% of the consolidated revenue of NSE, but in FY23 we expect it to touch the 35-40% mark," said Limaye.
Apart from spending on creating a data center, NSE is planning to revamp its cloud storage capabilities and also improve the surveillance systems by employing artificial intelligence tools.
