How a Scrip's Rate Is Arrived At

What a reference rate is

A reference rate is a published number for what a thing is generally worth right now, so that any particular price can be read against something rather than taken on faith. Currencies have one. Freight has one. Government bonds have one. Duty-credit scrips, for most of the time they have been tradable, did not, and the absence is exactly why the market ran on forwarded messages and whoever you happened to know.

For scrips the number would be expressed as a share of face value, because that is the only comparison that means anything. A scrip pays its full face against customs duty. It changes hands slightly below face, because the buyer is putting cash out today for a credit they will apply later. A reference rate would put a figure on that discount.

Why a seller wants one

The first time you sell a duty credit, you have no idea what a fair number looks like. That is not a failure of diligence; it is the ordinary position of anyone selling an instrument they have never sold before. A single quote in isolation cannot be judged. It could be generous, it could be two points light, and nothing on the screen tells you which.

A second number is what makes the first one legible. That need is real, and the rest of this page is about how it is answered honestly.

Why ScripX does not publish one

We could print a number every morning and call it a benchmark. We do not, and the reason is worth stating plainly.

A benchmark is a claim about a market, not about the firm publishing it. To be worth anything it has to be derived from where trades actually clear, published consistently, and defended when someone disagrees with it. At the volume this market currently trades on any single venue, a number like that is not a benchmark. It is an average wearing a suit, and the first two sellers who compare notes find that out.

So publishing one now would be asserting an authority nobody here has earned yet, and we would rather be short of a marketing line than long on one we cannot stand behind. If the day comes when a rate can be derived from real cleared volume, it will be earned rather than announced.

What we do instead

Every scrip is priced at the moment it is asked for, against live demand for that scheme, that expiry band and that size. Two identical scrips can price differently on two different days, because the demand behind them is different. That is a claim about our own book rather than about the market, which is why we can make it.

It is also the practical difference between an exchange and a desk. A number quoted off no book barely moves from one week to the next. A number made against live demand does, and it moves in both directions.

How the seller's real question gets answered

Not with an average of other people's trades, but inside the quote itself. A Sell Now offer shows the scheme rate it started from, what live demand added on the day in basis points and in rupees, and the gross you would receive. You are reading what moved your price on your scrip, which answers the question better than a market average would.

That number is firm for sixty seconds. It is a price rather than an indication: accept inside the minute and it is what you are paid, and the trade settles the same business day.

And occasionally there is no number at all. If nothing works for both you and a buyer, you see no offer rather than a poor one.

What a number is not

Any figure you meet for duty credit, in a chat window or on a website, is easy to over-read. It is worth being exact about the limits.

• It is not a quote. Nobody is bound by a number in the air, including us.
• It is not an offer to trade. Seeing a rate somewhere does not mean a trade exists at it.
• It is not a promise about your scrip. It describes duty credit in general, not the specific instrument sitting in your ledger.
• It is not advice on when to sell. That call is yours, and it depends on things no rate can see, starting with whether you need the cash.

What moves the number on a real scrip

A page that tells you only good things about its own pricing is not worth reading. So here are the reasons two scrips of the same face value are worth different amounts. None of them are unusual, and all of them are worth knowing before you sell.

• The scheme. RoDTEP and RoSCTL are different instruments to a buyer. They do not have to sit at the same level as each other on the same day, and one blended number across both would hide that.
• Validity remaining. A scrip is only useful while it can still be applied against duty. The less runway is left, the less room a buyer has to use it, and the less it is worth to them. A scrip does not improve with age.
• The size of the lot. A large, clean position and a small one are not the same proposition. Absorbing duty credit takes duty to absorb it against, and not every buyer has the same capacity.
• Whether it is whole. A whole scrip moves in one clean transfer. A part-used or split position carries more handling, and that shows up in what a buyer will pay for it.
• The day itself. Buy-side appetite for duty credit is not constant. It moves with what importers are actually clearing.

These are not caveats bolted on to protect a number. They are the reason no single number can be right for every scrip on every day. A rate card that claimed otherwise would be describing a market that does not exist.

How to read a number you are given

Two practical rules, whoever you are dealing with.

First, ask what moved it. A number handed over bare, with no reason attached, cannot be judged by anyone, and that is true of a good number as much as a poor one. A number that arrives with the scheme, the validity left and the size named beside it can be argued with, which is the point.

Second, if a number sits above face value, treat it as a warning rather than a win: a scrip is worth its full face against customs duty and not a rupee more, so a price above face is not generosity, it is a reason to look harder at who is offering it. The scams guide covers what that usually turns out to be.

If you want to see how a live price lands on one specific scrip, how RoDTEP and RoSCTL scrips are priced walks through it, and why scrips trade below face covers the underlying gap. See how ScripX works for exporters.

Frequently asked questions

What is a scrip reference rate?

A published number for what a duty-credit scrip is generally worth as a share of its face value, so that any price you are quoted can be read against something. No such number exists for duty credit in India today, and ScripX does not publish one, because at the volume this market trades it would not be a benchmark, it would be an average presented as authority.

How does ScripX decide what my scrip is worth?

Your scrip is priced when you ask for a price, against live demand for that scheme, that expiry band and that size. The workings are our own and are not published, but the outcome is: the offer shows the scheme rate it started from, what demand added on the day in basis points and in rupees, and the gross. You judge the number on what moved it, not on our description of how we got there.

Is the number I see the price I will be paid?

Your Sell Now offer is. It is a firm price on your actual scrip, locked for sixty seconds, with its reasons shown. Accept inside the minute and the trade settles the same business day. Any other figure you see for duty credit, anywhere, is not an offer.

Why does my offer differ from a number I saw somewhere else?

Because a number in the air describes duty credit in general and your offer describes your scrip. The scheme it was issued under, how much validity is left, how large the lot is, whether it is whole, and what the buy side is doing that day all move a real trade away from a general figure.

Can I sell above face value?

No, and you should be wary of anyone who says otherwise. A scrip is worth its full face value against customs duty and no more, so there is no economic reason for a buyer to pay above face. A price above face is a reason to check who you are dealing with.