MCX – Awaiting Volume Pick-Up; Recovery Needn’t Be Linear: ICICI Securities

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The key question for Multi Commodity Exchange of India Ltd. is its ability to recover volumes post the impact of higher margin trading norm.

Basis H1 FY22 average daily trading volume (14%/17% lower than FY20/FY21), we have cut FY22E ADTV from Rs 358 billion to Rs 312 billion.

However, the ADTV recovery is not bound to be linear. As such, we have cut FY23E ADTV by only 5% to Rs 390 billion.


Considering the reported ADTVs of ~Rs 324 billion in FY20, Rs 312 billion in FY21, Rs 433 billion in August 2020 and Rs 368 billion in February 2021, ADTV of Rs 390 billion is achievable by FY23E, which should translate to MCX’s FY23E earnings per share of Rs 61.4 implying 26 times FY23E price/earning at current market price.

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