Motilal Oswal has given Buy recommendation for MCX recommended buy rating on the stock with a target price of Rs 1800 in its research re with a target price of Rs. 1800 in its research report issued on Oct 26, 2022

Motilal Oswal’s research report on MCX

Net profit grew 96% YoY and 55% QoQ to INR641m. PAT came in 14% above our estimate, led by a beat in revenue, EBIT, other income, and the tax rate. Overall volumes improved by 25% QoQ and 71% YoY to INR35.9t. While volumes were in line, realizations in Options have been better than expected. Volumes from Futures fell 9% YoY and 6% QoQ to INR15.5t in 2QFY23, while the same for Options grew a strong 63% QoQ at INR20.4t.  Staff cost was higher by 11% YoY, but flat QoQ at INR229m. Software support charges saw a higher growth of 45% YoY and 16% QoQ, led by an increase in volumes. Overall EBIT grew 38% QoQ and 120% YoY to INR598m, better than our forecasts by 7%. EBIT margin stood at 47% v/s 32.7%/40% in 2QFY22/1QFY23, led by the incremental revenue from Options. Other income grew 14% YoY and 97% QoQ to INR182m (better than our forecast).


We like MCX for its near-monopoly in the Indian Commodity Exchange segment (92% market share). We have upgraded our FY23/FY24 EPS estimate by 11%/12% to factor in a better than expected realization in Option volumes. To build in exorbitant costs of the 63 moons contract for 3QFY23, we have assumed a 38% QoQ jump in software support charges. We value the stock at a multiple of 26x Sep’24 EPS. We maintain our Buy rating with a revised TP of INR1,800/share.

Leave a Reply

Your email address will not be published. Required fields are marked *