MCX stock surges 15% in August so far, biggest monthly gain in four months

Currently, there’s one option expiry per futures expiry, but the plan is to introduce multiple expiries for the same futures. Index options, which are cash-settled, will be based on either futures or goods, with no threshold for underlying futures volume.

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26 Aug, 2025 12:21

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Shares of Multi Commodity Exchange of India Ltd jumped over 15% in August, marking their biggest monthly gain in four months, driven by optimism about continued growth amid the launch of new products.

The stock hit a record high of Rs 4,957 on BSE, up 1.4 percent from previous close. So far 2024, MCX gained over 54 percent while in 2023 it jumped 105 percent.

HDFC Securities, in its recent note, said a meeting with the management boosted their confidence in the company's strategic direction, which includes launching new products like monthly series and index options, enhancing the technology stack, and increasing institutional participation and hedging activity on the platform. The appointment of the new MD & CEO,  Praveena Rai, is expected to significantly drive these initiatives forward, it said.

MCX’s product pipeline includes exciting contracts like 10gms monthly gold futures, monthly options with weekly expiry on crude, and index options on sunflower oil, cotton oil, and cotton candy. Technical testing for weekly options is underway, with launches planned post-testing and regulatory approval. While testing and approvals for new products can be lengthy, similar products often receive faster clearances.

Currently, there’s one option expiry per futures expiry, but the plan is to introduce multiple expiries for the same futures. Index options, which are cash-settled, will be based on either futures or goods, with no threshold for underlying futures volume.

HDFC Securities noted that MCX is well-positioned to navigate regulatory challenges, including curbs on index options volume, reversal of interest earned on clearing funds to CMs, and new true-to-label charges eliminating slab-wise fees. While MCX's commodity futures and options volumes are growing strongly, they remain in their early stages compared to equity derivatives markets.

"We believe that MCX will witness sustained growth in options volume and new products will fill the gaps and provide additional support to the growth story. We expect notional/premium volume to register a +61/43% CAGR over FY24-27E. We maintain our revenue and EPS estimate but increase the multiple to 40x vs 35x earlier based on better visibility", HDFC Securities said in a note while maintaining buy rating and increasing target price to Rs 6,000 a share.

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