Neutral MCX; target of Rs 8300: Motilal Oswal

Motilal Oswal's research report on MCX

MCX posted a 59% YoY growth in operating revenue, reaching the bestever quarterly revenue of INR3.7b (in-line), backed by volume growth of 77% YoY. Total expenses rose 29% YoY to INR1.3b, driven by 40%/25% YoY increase in other expenses and staff costs. EBITDA stood at INR2.4b (+82% YoY) in 1QFY26, reflecting an EBITDA margin of 64.8% vs 56.6% in 1QFY25. Strong revenue growth, coupled with a 73% YoY growth in other income, resulted in 83% YoY growth in PAT to INR2b (in line). While maintaining operational efficiency remains a key focus area for MCX, EBITDA margin is expected to remain under pressure in the near term, owing to weak volume trends and continued investments in tech and personnel.

Outlook

We have cut our EPS estimates for FY26/27 by 4%/7%, factoring in higher employee costs, slowdown in futures volumes, and lower premium to the notional turnover ratio. We reiterate a Neutral rating on the stock with a one-year TP of INR8,300 (premised on 42x FY27E EPS).