MCX shares recover after early fall, Morgan Stanley and UBS issue contrasting notes

MCX shares recover after early dip as investors eye regulatory moves

Shares of Multi Commodity Exchange (MCX) sharply recovered after opening lower on April 2, trading higher by around 2-3 percent after Morgan Stanley in a note talked about possible regulatory approval for the launch of weekly options, even though the note has given a target price far lower than the current share price.

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Morgan Stanley's note maintained an 'Underweight' stance on MCX with price target of Rs 3,400 per share, reflecting a potential downside of approximately 35 percent from Tuesday’s closing price of Rs. 5,230. According to Morgan Stanley, investors are keenly awaiting regulatory approval for the launch of weekly options, which they believe could provide upside potential for MCX.

In its latest financial update, MCX had reported transaction revenue of Rs 289 crore for the March quarter, marking a 4 percent decline from the previous quarter but a 60 percent rise compared to the same period last year. The revenue slightly missed Morgan Stanley’s projection of Rs 293 crore.

The Average Daily Transaction Revenue (ADTR) for fourth quarter stood at Rs 3.9 crore, marginally below the estimate. Going forward, the brokerage forecasts an ADTR of Rs 4.02 crore for FY26 and Rs. 4.19 crore for FY27.

Meanwhile, UBS has reiterated a 'Buy' recommendation on MCX but has revised its price target lower by 7 percent to Rs 7,250. UBS anticipates a 5 percent decline in Q4FY25 revenue, compared to the previous quarter, citing slightly weaker trading volumes, however, expects an improvement in the coming quarters.